Euro 3-mth Libor hits new low after ECB 1-yr tender

LONDON, June 24 (Reuters) - The interbank cost of borrowing
three-month euros hit a record low on Wednesday, according to
the latest daily fixing from the British Bankers' Association,
after the European Central Bank's first tender of 1-year money
drew stong demand.

The ECB said it would lend banks 442.24 billion euros,
higher than market expectations, with the excess liquidity
expected to pull interest rates lower.

Equivalent dollar rates also hit a new low ahead of the
outcome of the Federal Reserve's latest policy meeting where
rates are expected to be kept on hold.

The spread of three-month London interbank offered rates
over OIS rates for euros widened to 57 basis points from 52
basis points as three-month OIS fell, while equivalent dollar
and sterling spreads were unchanged.

The overnight euro Libor jumped to 1.27500 percent as banks
sought overnight funds to tide them over until the 1-year
auction funds on Thursday.

The spread expresses the three-month premium paid over
anticipated central bank rates, or Overnight Index Swap rates
and is seen as a gauge of banks' willingness to lend to each
other -- a wider spread is seen as an indication of decreased
inclination to lend.

Below is a table of the London interbank offered rates
(Libor) for dollar, euro and sterling funds in percentage terms,
with the change from the previous session in parentheses.

EURO STERLING DOLLAR
O/N 1.27500 (+0.59000) 0.55000 (+0.00000) 0.27563 (-0.00187)
1WK 0.71375 (-0.12375) 0.59000 (+0.00000) 0.29438 (-0.00250)
2WK 0.75875 (-0.10125) 0.61000 (-0.00250) 0.30000 (+0.00000)
1MO 0.84375 (-0.05563) 0.65875 (-0.00125) 0.31125 (-0.00250)
2M0 1.00750 (-0.03000) 1.01625 (-0.00500) 0.43375 (-0.00750)
3MO 1.18500 (-0.02563) 1.21438 (-0.00687) 0.60438 (-0.00312)
6MO 1.40625 (-0.01563) 1.43563 (-0.00687) 1.13125 (-0.01750)
1YR 1.57375 (-0.02188) 1.72000 (-0.00750) 1.64000 (-0.03750)

3MTH LIBOR/OIS SPREAD (BPs)

57 (+5) 81 (UNCH) 38 (UNCH)

For RICs to the above rates, go to <0#LIBORSUPERRICS>.