Trump says administration is weighing a currency swap with UAE to help bolster finances of Mideast ally rattled by war

WASHINGTON (AP) - Trump says administration is weighing a currency swap with UAE to help bolster finances of Mideast ally rattled by war.

When Trump suggested he backs the possibility of a currency swap with the United Arab Emirates, it's a sign that he is looking to help stabilize that country's economy in the wake of the disruptions caused by the Iran War.

In a currency swap, a foreign country's currency is used as collateral for a loan in U.S. dollars. That would enable the UAE to engage in dollar transactions that are at the core of global commerce.

The swap doesn't necessarily involve transferring tax dollars and can even generate a profit.

The U.S. has engaged in currency swaps in the past with many European countries, Japan, and the Trump administration last year opened a credit line for Argentina.