What’s Behind Last Week’s Libor Plunge: Blame The Inverted Yield Curve

Posted on February 10, 2019 6:35 pm
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URL https://www.zerohedge.com/news/2019-02-10/whats-behind-last-weks-libor-plunge-blame-inverted-yield-curve 

On Thursday morning, traders were stumped by a violent drop in 3m USD Libor, which after weeks of barely budging, saw its fixing plunge by more than 4bps, its biggest one day move since the financial crisis, prompting questions what was behind the sudden drop.

The move followed a declining trend in commercial paper yields, which banks use as one of the primary inputs in their Libor submissions.

According to Deutsche Bank’s Steven Zeng, a significant factor for the decline of commercial paper yields

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