At 12.30 GMT today the Ted spread had dropped to 1.93%.
In the three-month interbank lending markets, sterling Libor dropped from 4.5% to 4.42%, while three-month euro borrowing rates fell from 4.47% to 4.4% and three-month dollar Libor dropped to 2.24% from 2.29%.
In the overnight markets, borrowing costs were up slightly for euro and dollar Libor, which rose from 3.43% to 3.44% and 0.33% to 0.35%, respectively. Overnight sterling Libor remained stable at 3.21%.
The Chicago Board Options Ex