Ted spread drops to monthly low

The Ted spread, which tracks the difference between three-month Libor and US Treasury bills, dropped to 2.6% at 1200 BST today from 2.97% yesterday. Used as a measure of perceived counterparty risk, the Ted is now at its lowest level since September 23 when it stood at 2.5%.

In the overnight markets, US dollar borrowing costs moved to 1.27% from 1.51% yesterday, euro rates dropped to 3.55% from 3.57% and sterling decreased from 4.77% to 4.75%.

Three-month dollar Libor dropped from 4.06% to 3

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