The major currency pairs moved sharply in early Wednesday trading following the announcement of a concerted central bank move, consisting of the Fed, BoE, ECB, SNB and BoC, to alleviate global liquidity concerns and inject much-needed cash into the credit-tight financial markets. The Fed pledged at least $40 billion in a new term auction facility in which loans would be auctioned off at rates far beneath the discount rate, as well as announcing swap lines with the ECB and SNB for up to 6-months. The kneejerk reaction to the news was a sharp jump higher in US equity futures, which coincided with a sell-off in the yen as traders rewarded the carry trade pairs. The dollar came under selling pressure against the euro and sterling, falling to 1.4748 and 2.0576, respectively.

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