US Allies Request Currency Swaps Amid Iran War

United States Treasury Secretary Scott Bessent testified Wednesday that several allies in the Persian Gulf and Asia have requested currency swap lines from the U.S. to mitigate economic disruptions caused by the ongoing U.S.-Israel war against Iran. The requests, discussed during a Senate Appropriations Committee hearing in Washington, come amid energy shocks and market instability affecting global trade, with President Donald Trump indicating support for providing such assistance to at least one Gulf nation.

Bessent, appearing before the Subcommittee on Financial Services and General Government, explained that the proposed swap lines would allow central banks to exchange currencies for liquidity in U.S. dollars, helping to stabilize financial markets during periods of uncertainty. "Swap lines, whether from the Federal Reserve or the Treasury, are to maintain order in the dollar funding markets and to prevent the sale of U.S. assets in a disorderly way," he said. He added that the arrangements would benefit both the requesting countries and the United States, noting that "numerous other countries, including some of our Asian allies," have made similar appeals, though he did not...