FRANKFURT, May 11 (Reuters) - The European Central Bank (ECB) boosted cash supply in the market via its short and long term liquidity operations on Tuesday, re-starting its U.S. dollar operations with a bang.
The ECB decided on Monday to re-establish currency swap lines with the U.S. Federal Reserve as part of its plan to stop Greece's debt woes from spreading and aims to keep ample liquidity for investors available on favourable terms.
Banks borrowed $9.2 billion (7.25 billion euros) at the ECB's first U.S. dollar operation since the end of January, when operations were stopped as part of the ECB's exit strategy, and paid 1.22 percent interest.
This was the highest volume since December 10.
The ECB lent banks 20.48 billion euros over 35 days [ID:nECB000079], up from 15.73 billion euros in the 28-day operation in April. It injected 99.57 billion euros over seven days, up from 90.32 million seen last week.
European policymakers designed a $1 trillion aid package on Monday - involving the European Union and the IMF - to defend the euro against any spill-over effects on other euro zone countries.
The single currency had soared on Monday on the news, but gave up its gains on Tuesday as investors' focus switched back to structural problems plaguing the bloc [ID:nLDE64A11C].
(Reporting by Martin Santa; Editing by Ron Askew)