The central bank's decision to provide dollar swap lines to Europe was made in the United States' best interests and not solely to benefit Europe, a top Federal Reserve official said on Tuesday.
We want to make the decision based on what's in our self-interest as a country, what's best for U.S. households and businesses, New York Federal Reserve Bank President William Dudley told a subcommittee of the U.S. House of Representatives' Financial Services Committee.
The U.S. central bank provided dollar swap lines for the European Central Bank to help ease its debt crisis but Dudley stressed the action was aimed at warding off a backlash for the U.S. economy from a more severe European downturn.
If in that calculation we decide that an intervention can help the U.S. households and businesses then we want to pursue it and if we think there's too much risk involved in the program...we don't want to take it, he said.
Dudley pointed out that the U.S. central bank has never lost money, and in fact has earned profits, on past swap lines that it has extended back to 1962.
(Reporting By Glenn Somerville and Lucia Mutikani; Editing by Chizu Nomiyama)