Costs rise for dollar loans despite $50bn auction

The Federal Reserve's latest Term Auction Facility operation failed to quell rising interbank tensions as money-market rates for one-month dollar loans climbed on Tuesday 25 March.

The Fed pledged $50 billion in four-week loans on Tuesday but the London Interbank Offered Rate (Libor), a measure of money-market borrowing costs, for month-long loans rose by five basis points from 2.6% last Thursday to 2.65%.

The lowest borrowing cost for the Fed funds, the so-called stop-out rate was 2.62%. Eig

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