BLBG:Bank Dollar Funding Costs At Year Low In European Money Markets
The cost for European banks to borrow in dollars held at the lowest level in more than a year, according to a money-markets indicator.
The three-month cross-currency basis swap, the rate banks pay to convert euro interest payments into dollars, was 33.5 basis points below the euro interbank offered rate, or Euribor, at 8:20 a.m. in London. It reached as low as minus 32 basis points yesterday, the cheapest since July 22, 2011.
The one-year basis swap was little changed at 39 basis points below Euribor, according to data compiled by Bloomberg. A basis point is 0.01 percentage point.
The three-month Eonia swap rose to the highest since Aug. 3. The swap was at eight basis points from 7.7 yesterday. The European Banking Federation’s euro overnight indexed average, or Eonia, of unsecured lending deals was set at 0.111 percent yesterday, from 0.112 percent the day before.
Banks cut overnight deposits at the Frankfurt-based European Central Bank to 322 billion euros ($398 billion) yesterday from 351 billion euros the day before.
To contact the reporter on this story: Katie Linsell in London at klinsell@bloomberg.net
To contact the editor responsible for this story: Paul Armstrong at parmstrong10@bloomberg.net
