Oct. 14 (Bloomberg) -- The cost of borrowing in dollars for one week fell the most in almost a month after the U.S. joined the U.K., Germany and France in offering to buy stakes in banks to restore confidence in global financial markets.

The London interbank offered rate, or Libor, that banks charge each other for such loans dropped 50 basis points to 4.08 percent today, the British Bankers' Association said. It was at a record of 4.76 percent on Oct. 9. The overnight dollar rate slid 29 basis points to 2.18 percent, down from 3.94 percent a week ago. The three-month rate fell 12 basis points to 4.64 percent.

The Libor-OIS spread, a gauge of cash scarcity among banks, narrowed 15 basis points to 339 basis points.

To contact the reporter on this story: Gavin Finch in London at gfinch@bloomberg.net

Last Updated: October 14, 2008 07:00 EDT