Dollar Libor up after Tarp priorities change

Dollar Libor was up today following US Treasury secretary Hank Paulson's admission yesterday that the Troubled Asset Relief Programme (Tarp) will not be used to buy illiquid mortgage-backed securities.

In the overnight markets, dollar Libor rose 0.02 percentage points to 0.40% from 0.38% yesterday, while three-month dollar borrowing rates rose from 2.13% to 2.15%.

The Ted spread, which tracks the difference between three-month dollar Libor and Treasury bills, closed yesterday at 2%, up 0.25 percentage points from 1.75% at the close on Tuesday, November 11. At 12:00pm London time today, the Ted spread stood at 2.01%.

Paulson confirmed in yesterday's announcement that the US government would not

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