Thursday April 17, 12:10 PM
UK three-month interbank lending rate inches lower
LONDON (Thomson Financial) - The rates at which banks lend to each other in the United Kingdom continued to decrease, but only slightly, on Thursday.
The key three-month Libor rate edged down marginally to 5.91 percent from 5.92 percent,
while the one-month rate fell to 5.50 percent from 5.52 percent.
The overnight contract, generally the most closely aligned to the BoE's 5.00 percent benchmark rate, rose to 5.089 percent from 5.086 percent on Wednesday.
Despite the small falls, interbank lending rates remain high, even after the Bank of England cut interest rates by a quarter point last week.
The Bank (TBHS - news) of England is understood to be close to agreeing a plan with banks where it would accept to swap mortgage-based assets in exchange for government bonds. These could then be used for interbank lending, to improve credit markets and to fund mortgage lending.
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