The rate at which London-based banks say they can borrow for three months in dollars rose for the eighth straight day, reaching the highest level since August 2010. The London interbank offered rate, or Libor, for dollar loans climbed to 0.35500 percent from 0.35250 percent yesterday, according to data from the British Bankers’ Association. That’s the biggest daily increase in a week and the highest rate since Aug. 16, 2010. The dollar Libor-OIS spread, a gauge of banks’ reluctance to lend, was at 29.00 basis points as of 11:53 a.m. in London, from 28.95 basis points yesterday, the widest on a closing-price basis since July 27, 2010, according to data compiled by Bloomberg. The TED spread, or the difference between what lenders and the U.S. government pay to borrow for three months, rose for a 12th day. It widened to 35.50 basis points from 35.25 basis points yesterday. To contact the reporter on this story: Keith Jenkins in London at kjenkins3@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

Source