The US financial crisis has reverberated all over the globe with central banks of most well-off nations stepping in to inject billions of dollars in their respective financial systems to calm beleaguered markets and ensure the smooth operation of the global financial system.

The US has pumped in a total of $120 billion over the past three days in their banking system while the European and Asian central banks, with Japan, England, European Union, Australia and Russia among others have pumped in more than approx $245 billion since the beginning of the week as well as taking financial related measures in trying to shore up markets and deal with the current market upheaval.

The recent financial turmoil has sent shockwaves to leading international banks and brought together the top 10 international banks - Bank of America, Barclays, Citibank, Credit Suisse, Deutsche Bank, Goldman Sachs, JP Morgan, Merrill Lynch, Morgan Stanley and UBS -  to to pool in $7 billion each as emergency money to meet any contingency to avert a collapse.

The US Federal Reserve injected $50 billion of temporary reserves on Monday apart from the $70 billion it had pumped earlier over a period of three days into the banking system to alleviate the credit stress, a day after the collapse of Lehman Brothers.

For the first time in its 90-year history the US Federal Reserve announced it would accept shares from banks in exchange for cash thereby bringing down the interbank interest rates, even though they hovered well above 2 per cent.

The New York stock exchange lost 500 points on Monday, the biggest one-day drop since the 9 / 11 terrorist attacks.

The European Central Bank gave $99.8 billion in a one-day money-market auction which received 51 bids for $127 billion on its one-day tender with a bid rate of 4.25 per cent, a clear sign that demand for cash is high with the same being followed in England where the Bank of England pumped $36 billion and offered $9 billion in a three-day auction that drew bids for $43 billion, or nearly five times the amount that was offered, while the Zurich-based Swiss National Bank said it was giving liquidity in "a generous and flexible manner" at an overnight rate of 1.9 per cent although it did not quantify the amount of money being put up

Yesterday the Russian finance ministry said it will loan the country's three largest banks --- Sverbank, VTB and Gazprombank up to $44 billion in order to ease the liquidity crunch. These loans are for a period of three months. Speculation was rife that the Central Bank sold foreign reserves to prop up the rouble making it rise against its dollar-euro baskets on Tuesday. Russia has the third largest reserves in the world with $573.6 billion as of 5 Sept.

In the Asian scenario, the central bank of Taiwan supplemented $3.59 billion into the foreign-currency interbank market, whereas China cut interest rates for the first time since February 2002 in order to avert their booming economy from slowing down and relieve strains in the banking system. It also relaxed reserve requirements for some banks.

South Korea and Singapore said that they would be willing to shore up their financial markets by providing it with more liquidity if it was deemed necessary with Korean central bank governor, Lee Seong Tae saying that The Bank of Korea would buy government bonds directly from the market if so required.

The Reserve bank of India said it will take temporary measures to contain excess volatility and ensure liquidity in its financial markets by temporarily providing additional liquidity to domestic banks and will continue to sell dollars, at market rates, to boost local supply.

The Bank of Japan injected $29.3 billion and the move came as Japan's uncollateralized overnight call rate was moving between 0.56 per cent and 0.67 per cent, well above the central bank's target of 0.5 per cent showing that the surge indicated the extent of foreign financial institutions using Japanese financial markets for their funding operations while.

The Reserve Bank of Australia pumped $3.45 billion as their one-year swap rates rose 14 basis points, as credit worries failed to cease inspite of the RBA's pumping funds for almost two months.