Treasury Secretary Scott Bessent said Friday that talks about establishing or expanding U.S. dollar swap lines with partner countries in the Gulf and Asia are ongoing and form part of routine diplomatic and financial engagement.
Posting on the social media platform X, Bessent outlined several reasons why additional swap lines could be advantageous. He said they can reinforce the international use of the U.S. dollar and enhance dollar liquidity globally, help preserve orderly functioning in dollar funding markets, and encourage trade and investment between the United States and its partners. He also noted that many of the countries in question enter talks with strong sovereign balance sheets and sizable dollar reserves.
According to Bessent, allies are taking a prudent approach by exploring extra financial cushions during periods of market calm. He commended that forward-looking stance and careful risk management as countries examine ways to build buffers ahead of potential disruptions.
Bessent added that making swap lines permanent could represent a significant initial move toward establishing new U.S. dollar funding centers in regions such as the Gulf and Asia. He framed that step as a potential structural development in how dollar funding is provisioned outside traditional centers.
Earlier in the week, Bessent said that a number of allies in the Gulf and across Asia have requested currency swap lines from the United States specifically to help manage energy shocks and other consequences stemming from the Iran war. Those requests, he said, are part of the broader set of conversations being held by the Treasury.
The Federal Reserve currently operates standing dollar liquidity swap lines with a group of central banks: the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank. Bessent's comments indicate that discussions about adding or expanding swap arrangements with other partners remain active at the Treasury level.
While Bessent presented these talks as routine and constructive, he did not announce any concrete agreements or timelines. The conversations emphasize preparation and coordination around dollar funding, liquidity and the potential for expanded financial infrastructure in targeted regions.