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A two-country open-economy DSGE model to evaluate the macroeconomic stability effect of the People's Bank of China (PBoC) currency swap. The simulation results indicate that the PBoC's currency swap has a macroeconomic stability effect, but moral hazard weakens this effect. Using sample data from 182 economies from 2007 to 2022 and empirical results based on the staggered DiD model, it is shown that currency swaps help suppress macroeconomic fluctuations and cushion the negative impact of rising US dollar financing costs. The larger the scale of the central bank's reduction in foreign exchange reserves in a currency swap economy is, the weaker the macroeconomic stability effect of the PBoC's currency swap. Further discoveries show that the PBoC's currency swap has a greater macroeconomic stability effect on emerging economies.