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News on the Euribor

Three-month euro Libor rates were fixed at 1.828 percent
03 March 2009 @ 09:58

 Commercial banks' overnight deposits at the European Central Bank inched higher as they continued to park cash with the bank rather than lend it in money markets..

Three-month euro Libor rates were fixed at 1.828 percent, their lowest ever during the currency's lifetime as Euribor bank-to-bank euro lending rates also hit a record low, pressured by generous short-term money supplies and expectations of lower official interest rates in coming months.

Three-month Euribor rates -- fixed daily by the Banking Federation of the European Union -- form a benchmark for much short-term commercial lending in Europe. Libor rates are fixed by the British Bankers Association.

The three-month euro Libor spread over OIS rates was a touch narrower at 98 basis points while the equivalent spread for sterling widened by four basis points to 166 basis points.

Spot Libor-OIS spreads for euro and sterling have widened this week as markets price in possible rate cuts next week by the ECB and the Bank of England.

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