WASHINGTON, April 22 - U.S. Treasury Secretary Scott Bessent told a U.S. Senate Appropriations subcommittee budget hearing that a number of allies in the Gulf and in Asia have formally requested currency swap lines from the United States. The requests, Bessent said, are aimed at dampening the financial shockwaves from the ongoing Middle East war and the energy-related disruption it has caused.
Bessent said he did not identify which countries had made the requests. He stressed that such facilities - whether provided by the Federal Reserve or the Treasury - exist to preserve functioning in dollar funding markets and to avert disorderly sales of U.S. assets during periods of strain.
"And swap lines, whether it’s from the Federal Reserve or the Treasury, are to maintain order in the dollar funding markets and to prevent the sale of the U.S. assets in a disorderly way," Bessent said.
President Donald Trump said on Tuesday that he was considering a swap line, and Bessent told senators that a proposed arrangement would provide mutual benefit. "So, the swap line would benefit both the UAE and the U.S., and as I said, numerous other countries, including some of our Asian allies, have also requested them," he added.
In his testimony, Bessent framed swap lines as a tool to stabilize financial markets that face spillovers from geopolitical conflict. He presented the facilities as a means to maintain orderly dollar funding conditions - a priority for market functioning and for institutions that depend on dollar liquidity.
Bessent also emphasized the cross-border nature of the requests, noting that both Gulf partners and Asian allies have sought access. He did not provide additional details on timing, size, or the specific modalities of any proposed facility, and the countries involved were not named.
The secretary’s remarks highlighted the role of swap lines in the toolkit available to U.S. financial authorities to respond to stress in global dollar funding markets. They also underscored that the proposed swap would be intended to serve both U.S. interests and those of the foreign counterparties that have sought support.
Context limitations - The hearing record does not include the identities of the countries requesting the facilities, nor does it outline precise terms or a timeline for any swap line implementation.