The Federal Reserve's dollar swap facility was effective in reducing dollar funding costs and acted as a successful backstop for depository institutions, a New York Federal Reserve paper published on Friday says.

Linda Goldberg, Craig Kennedy and Jason Miu, the three authors, describe the events leading up to the introduction of the dollar swap lines, and review the evolution of dollar swap facilities that the Federal Reserve established with foreign central banks in 2007 and 2008.

The authors