Money Market rates continue to tumble across Europe

inspector_monkfish

10:09 28Apr09 THREE-MONTH EURIBOR INTEREST RATE <EURIBOR3MD=> FIXES AT 1.384 PCT VS 1.392 PCT PREVIOUSLY
10:09 28Apr09 ONE-WEEK EURIBOR INTEREST RATE <EURIBORSWD=> FIXES AT 0.869 PCT VS 0.903 PCT PREVIOUSLY
10:10 28Apr09 SIX-MONTH EURIBOR INTEREST RATE <EURIBOR6MD=> FIXES AT 1.579 PCT VS 1.588 PCT PREVIOUSLY


FRANKFURT, April 28 - The key three-month Euribor
bank-to-bank euro lending rate fell on Tuesday and reached a new
record low, as the European Central Bank has lowered official
interest rates and flooded markets with cash.

The three-month Euribor rate, traditionally the main gauge for interbank euro lending and a mix of interest rate expectations and banks' appetite for lending, fell to a new all-time low of 1.384 percent from 1.392 on Monday.

The six-month Euribor rate fell to 1.579 percent from Monday's 1.588 percent, while the shorter term one-week rate slid to 0.869 percent from 0.903 percent.

The ECB cut rates by a smaller-than-expected 25 basis points
earlier this month. The move took the main policy rate to 1.25
percent and the overnight deposit rate -- which is acting as a
floor for short-term lending -- to 0.25 percent. The central bank's President Jean-Claude Trichet also said the deposit rate was unlikely to be cut further.

Overnight lending rates were quoted at a bid/ask
spread of 0.35/0.60 percent at 0912 GMT, compared with the
average on Monday of 0.638 percent.

Euribor rates are fixed daily by the Banking Federation of
the European Union (FBE) shortly after 0900 GMT.

Three-month rates form a benchmark for much short-term
commercial lending in Europe, and one-week rates give an
indication of banks' very short term financing conditions.

chucky

what's the 3 and 5 year Libor rates looking like over the last 6 weeks?

System

chucky wrote: »

what's the 3 and 5 year Libor rates looking like over the last 6 weeks?

A long downward sloped line.

inspector_monkfish

chucky wrote: »

what's the 3 and 5 year Libor rates looking like over the last 6 weeks?

LIBORs are only fixed upto 1yr

purch

LIBOR's are set from Overnight to 12 months

chucky

thanks - what are 2, 3 and 5 year rates based off?
i did think they were Libor

edit - they were Swap rates not Libor

inspector_monkfish

chucky wrote: »

thanks - what are 2, 3 and 5 year rates based off?
i did think they were Libor

edit - they were Swap rates not Libor

i only usually concentrate on upto 1yr
i'll see if i can find any info regarding longer terms

inspector_monkfish

no-one is quoting anything upto 5yr depos as far as i can find
can be roughly worked out against the Swap though

LIBORs in all major currencies have tumbled today, by 1 or 2pts across the board.

3mth USD LIBOR is edging closer and closer to under 1pct
1.03938 today, it was at 1.25 just a month ago

chucky

i had always looked on here http://clpuk.com/swaps.htm and had noticed that the 3 and 5 year rates had started to creep up which i had thought had pushed some lenders to increase the 5 year rates.

inspector_monkfish

here you go....



GBP SWAPS


2 YRS 2.1500-2.1100
3 YRS 2.5900-2.5500
4 YRS 2.9075-2.8575
5 YRS 3.1275-3.0775
6 YRS 3.2950-3.2450
7 YRS 3.4275-3.3775
8 YRS 3.5325-3.4825
9 YRS 3.6225-3.5725
10YRS 3.6950-3.6450
12YRS 3.8475-3.7775
15YRS 3.9925-3.9025
20YRS 4.0150-3.8850
25YRS 3.9050-3.7750
30YRS 3.8425-3.7125
40YRS 3.8525-3.6825
50YRS 3.9175-3.7475
60YRS 3.9875-3.8175

Generali

AIUI, 'green shoots' are starting to focus minds on the possibility of inflation and thus rising interest rates in future.

That would explain short rates falling and long rates rising.

PS Who the hell wants to enter into a 60 year swap? The chances are you'll be dead before maturity.