The cost for European banks to borrow in dollars rose for a fifth day to the highest in two weeks, according to money-market indicators.
The three-month cross-currency basis swap, the rate banks pay to convert euro payments into dollars, was 147 basis points below the euro interbank offered rate at 9:44 a.m. in London, from 141 basis points yesterday. The gap has widened by 38 basis points since Dec. 8 when the European Central Bank cuts its main interest rate.
The one-year basis swap is 105 basis points under Euribor, matching the highest cost since December 2008, data compiled by Bloomberg show. The spread was minus 97 yesterday. A basis point is 0.01 percentage point.
A measure of banks’ reluctance to lend to one another in Europe rose. The Euribor-OIS spread, the difference between the borrowing benchmark and overnight index swaps, was at 96 basis points from 95 yesterday.
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