Strain eases on interbank lending

The Ted spread, which tracks the difference between three-month Libor and US Treasury bills, dropped today to 2.92% after reaching 3.02% on September 24 and 25.Three-month US dollar Libor also declined, falling to 3.762% today, from a peak of 3.769% yesterday. Conversely, the cost of borrowing euro for three months reached a monthly high, climbing to 5.139% from 5.111% on September 25.Since peaking at 6.438% on September 16, the overnight US dollar Libor rate has continued its downward trend