| 3 Month LIBOR Rate |
| By Bankrate.com |
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| LIBOR, other interest rate indexes |
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This week |
Month ago |
Year ago |
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3 Month LIBOR Rate
|
4.32 |
2.81 |
5.25 |
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What it means:
LIBOR stands for London Interbank Offered Rate. It's the rate of interest
at which banks offer to lend money to one another in the wholesale
money markets in London. It is a standard financial index used in
U.S. capital markets and can be found in the Wall Street Journal.
In general, its changes have been smaller than changes in the prime
rate.
How it's used:
It's an index that is used to set the cost of various variable-rate
loans. Lenders use such an index, which varies, to adjust interest
rates as economic conditions change. They then add a certain number
of percentage points called a margin, which doesn't vary, to the index
to establish the interest rate you must pay. When this index goes
up, interest rates on any loans tied to it also go up. Although it
is increasingly used for consumer loans, it has traditionally been
a reference figure for corporate financial transactions.
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