Dollar debt in FX swaps and forwards: huge, missing and growing

Claudio Borio, Robert McCauley and Patrick McGuire

BIS Quarterly Review, 2022

Abstract: FX swaps, forwards and currency swaps create forward dollar payment obligations that do not appear on balance sheets and are missing in standard debt statistics. Non-banks outside the United States owe as much as $25 trillion in such missing debt, up from $17 trillion in 2016. Non-US banks owe upwards of $35 trillion. Much of this debt is very short-term and the resulting rollover needs make for dollar funding squeezes. Policy responses to such squeezes include central bank swap lines that are set in a fog, with little information about the geographic distribution of the missing debt.

JEL-codes: F31 F34 F41 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (10)

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