3-mo dlr Libor in biggest jump since Aug 9 last yr

LONDON - The interbank cost of borrowing three month dollar and sterling funds jumped on Tuesday as banks adjusted to the prospect of higher central bank interest rates after comments made by Federal Reserve Chairman Ben Bernanke late on Monday.

By (Reuters)

Published: Tue 10 Jun 2008, 6:36 PM

Last updated: Sun 5 Apr 2015, 1:08 PM

The three-month dollar London interbank offered rate saw its biggest one-day increase since August 9 last year, the day in which the global credit crisis erupted.

Three-month euro Libor eased slightly, although it had risen sharply on Friday, a day after European Central Bank President Jean-Claude Trichet said a small rate hike as soon as July was possible in order to anchor inflation expectations.

The premium paid for borrowing three-month euro and dollar funds in the interbank market over anticipated central bank rates over the same period, or Overnight Index Swap rates -- eased slightly, while the sterling spread widened.

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