interbank-rates-ease-but-recession-looms

Interbank rates ease, but recession looms

Interbank rates in Asia have come down considerably, but recession remains a threat and the risk of high-profile defaults is becoming a reality.

By Mukul Munish

October 23, 2008

Asian interbank rates have continued their decline this week after billions of dollars were pumped into the banking system by US, European and Asian governments, but the action may not be able to stave off a global recession.

In Hong Kong, the three-month Hong Kong interbank offered rate was quoted at 3.23% on Thursday, slightly higher than WednesdayÆs 3.14%, but much lower than last FridayÆs 4.19%. Likewise in Singapore, the three-month interbank rate for US dollars slipped to 3.63%, the lowest in four weeks. The three-month London interbank offered rate for US dollars, better known as Libor and considered the benchmark of interbank rates internationally, was trading at 3.53% on Thursday, down sharply from...

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