The central bank on Tuesday announced the results of its most recent auction - the eighth since the program started in December - where commercial banks bid to get a slice of US$50 billion in short-term loans.

It's part of an ongoing effort by the central bank to provide relief to a spreading credit crunch that has unnerved financial markets.

The situation threatens to push the country into a deep recession.

Counting the latest auction results announced on Tuesday, the Fed has provided a total of $260 billion in short-term loans to banks since December.

In the most recent auction - which marked the eighth - commercial banks' paid an interest rate of 2.615 per cent, the lowest rate for any of the auctions of this kind conducted so far.

There were 88 bidders for the latest slice of the $50 billion in loans.

Demand was high.

The Fed received bids for $88.9 billion worth of loans. -- AP