LONDON, Aug 19 (Reuters) - The interbank cost of borrowing
three-month sterling funds marked a new low on Wednesday after
minutes of the Bank of England's August meeting suggested the
central bank has not closed the door on its quantative easing
programme.
The equivalent euro and dollar rates were also set at fresh
record lows, the latest daily fixing from the British Bankers'
Association showed.
The BoE minutes revealed that Governor Mervyn King and two
other Monetary Policy Committee members wanted to raise the
quantitative easing programme by 75 billion pounds but were
outvoted by the remaining 6 policymakers in favour of the 50
billion pounds decision. See [ID:nLJ732438]
The spreads of three-month London interbank offered rates
over OIS rates for dollar and sterling tightened further, with
the sterling spread narrowing 1 basis point to 38 bps.
The spread expresses the three-month premium paid over
anticipated central bank rates, or Overnight Index Swap rates
and is seen as a gauge of banks' willingness to lend to each
other -- a wider spread is seen as an indication of decreased
inclination to lend.
Below is a table of the London interbank offered rates
(Libor) for dollar, euro and sterling funds in percentage terms,
with the change from the previous session in parentheses.
