LIBOR still dropping...

RomansProperties

Why do you think the 12 month rate stayed the same?
Is it a sign thats the lowest its going to go?

inspector_monkfish

RomansProperties wrote: »

Why do you think the 12 month rate stayed the same?
Is it a sign thats the lowest its going to go?

it could be read that way, but 1 day of no change is not really a good market indicator!
wait and see what it does over the coming days....
we had a day of no change in 12mths LIBOR between 2nd and 3rd April also
LIBORs can move higher or lower on the slightest bit of news these days (particularly USD)

here is a good indicator:

GBP Base rate 0.50pct - 12mth LIBOR 1.98625 (149 basis points premium)

EUR Base Rate 1.25pct - 12mth LIBOR 1.76688 (52 basis points premium)

USD Base rate 0-0.25pct - 12mth LIBOR 1.9125 (166-191 basis points premium)

So we are currently somewhere inbetween US and EuroZone.

Big Questions are: Which way are we going to go? Or are we bang on, and they are going to get closer to us? Or are we all about right for our respective economies??

Who knows?????!!!!

RomansProperties

Thanks for the info.
Will keep on monitoring the situation.
My next LIBOR reset is 1st July.
This makes quite a difference as 3 deals change for me on 1st June

inspector_monkfish

16/04 LIBORs

3mth 1.52438 (down 1 point)
6mth 1.75750 (down 1 point)
12mth 1.98125 (down 1/2 point)

inspector_monkfish

LIBORs 17/04

3mth 1.51813 (down 1/2pt)
6mth 1.7525 (down 1/2pt)
12mth 1.97688 (down 1/2 pt)

inspector_monkfish

inspector_monkfish wrote: »

LIBORs 17/04

3mth 1.51813 (down 1/2pt)
6mth 1.7525 (down 1/2pt)
12mth 1.97688 (down 1/2 pt)

LIBORs 20/04

3mth 1.50813 (down 1pt)
6mth 1.74188 (down 1pt)
12mth 1.96625 (down 1pt)

CFC

How about a translation? Is the LIBOR rate the rate that the banks charge each other - their own 'personal base rate'?

dunamis

I tried to post a link but apparently I'm a new user so I can't

Anyway, if you go to www. thisismoney. co .uk /libor there's some good basic info.

I guess there are better sites out there but that one is fine for folks like me who only half know what they're talking about

RG

inspector_monkfish

CFC wrote: »

How about a translation? Is the LIBOR rate the rate that the banks charge each other - their own 'personal base rate'?

its a good indicator of where the market sees rates heading over the next 12m (although not a perfect one)

16 Banks submit their rates to the BBA by 11.00am everyday
BBA then knock off the the top 4 and bottom 4, then take an average of the remaining 8.

LIBORs can be used as a starting point for InterBank lending/borrowing, but as the market nowadays is extremely tiered with good banks and bad banks, some are in a position where they pay well below LIBOR, and others have to pay well over LIBOR, due to risk factors.

Many corporate loans are fixed using a LIBOR basis, depending on the Company rating.

Have a look here:
http://www.bba.org.uk/bba/jsp/polopoly.jsp?d=141

inspector_monkfish

LIBORs 21/04

3mth 1.5040 (down 1/2pt)
6mth 1.73688 (down 1/2pt)
12mth 1.96125 (down 1/2pt)