The U.S. Federal Reserve said today it will provide US$60 billion in fresh cash to commercial banks in two auctions in February and will keep holding auctions every other week for as long as needed to ease the credit crisis.

The new auctions, to be held on February 11 and February 25, will mark the fifth and sixth times the Fed has used a new auction process announced in December to provide cash-strapped banks with extra reserves.

In a brief statement, the Fed said that it intended to keep holding the auctions every other week “for as long as necessary to address elevated pressures in short-term funding markets.”

The Fed said that the minimum bid amount for the February auctions will be reduced to US$5 million, down from US$10 million in the previous auctions, to “facilitate participation by smaller institutions.”

The world’s central banks – including the Bank of Canada – have been intervening in financial markets to improve liquidity ever since the U.S. subprime mortgage crisis hit the headlines last summer.

In its statement, the Fed said it would announce the size of the March auctions by February 29.