NEW YORK, Oct 31 (Reuters) - A key gauge of interbank borrowing costs for dollars rose on Wednesday, marking its largest monthly increase since March, amid worries about rising Treasury bill supply and the Federal Reserve’s reduction of its balance sheet.
The London interbank offered rate for banks to borrow three-month dollars from each other climbed 1.75 basis points to 2.5585 percent, the highest since October 2008.
For October, LIBOR grew 16.0 basis points, which was the biggest increase since a 29.5 basis points jump seven months ago.
LIBOR is the rate benchmark for $200 trillion of dollar-denominated financial products, mainly interest rate swaps and floating-rate loans.
Reporting by Richard Leong Editing by Chizu Nomiyama