It said: "Prior to [today's foreign exchange] actions, we estimate recent movements in the pound/euro exchange rate increased overall debt by around £30m. "Covenants would only be breached if our estimated earnings for the second half of 2009 were to fall by another £11m (13%) and/or if sterling was to weaken (significantly) further against the euro.
The G7 came out with a careful statement this week that saidWe, the G7 Ministers and Governors, reaffirm our longstanding commitment to market determined exchange rates and to consult closely in regard to actions in foreign exchange markets.
Civil legal actions on foreign exchange manipulation are also in the offing for both banks.
The focus will be on ensuring stability in the foreign exchange market before taking further monetary policy action.
It's the implosion of the senior market, debt, that is the author of this crisis, not stocks, and the real action now is in foreign exchange.
Competitors, including an independent foreign exchange trading rival, Currenex, have said that the actions of the big firms have limited the development of the Internet alternative to trading.
Black-market activity in foreign exchange is prevalent in countries in which convertible foreign exchange is scarce and strict control of foreign exchange exists.
Barclays has put aside another £800m, largely to cover potential further legal action and penalties for alleged foreign exchange manipulation.
"We will firmly maintain our policy of taking appropriate action if there are rapid moves in foreign exchange rates".
UBS said on Monday it would continue to take "appropriate action" over personnel in connection with the foreign exchange inquiry.
The government has sufficient foreign exchange reserves to defend itself against speculators, but the Fed action helps ease the pressure exerted by the cyclical downturn on the country's balance of payments over the next two quarters, Belchere said.
