LIBID: Difference between revisions
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London | Formerly and informally a guess at the interest rate at which large banks of good credit standing might be expected to offer to lend to other such banks in the London inter-bank short-term, unsecured money market at a particular time and in a particular currency. Use of this term is deprecated. | ||
LIBID is formed as a kind of analogy to LIBOR – originally an acronym for London Inter-Bank Offered Rate. One might expect LIBID to be a lower rate than LIBOR but as the term is informal such distinctions are blurred and conceptually a large bank of high credit standing is on both sides of a LIBOR-LIBID deal at the same rate. | |||
As there is no observed rate, informally LIBID is often taken as 1/8th % less than LIBOR. | |||
In analogy with London Inter-Bank Offered Rate, LIBID is sometimes expanded as London Inter-bank Bid rate. | |||
== See also == | == See also == | ||
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* [[London inter-bank mean rate ]] | * [[London inter-bank mean rate ]] | ||
* [[London Interbank Bid Rate]] | * [[London Interbank Bid Rate]] | ||
* [[LIBOR]] | |||
Revision as of 14:45, 1 August 2013
Formerly and informally a guess at the interest rate at which large banks of good credit standing might be expected to offer to lend to other such banks in the London inter-bank short-term, unsecured money market at a particular time and in a particular currency. Use of this term is deprecated.
LIBID is formed as a kind of analogy to LIBOR – originally an acronym for London Inter-Bank Offered Rate. One might expect LIBID to be a lower rate than LIBOR but as the term is informal such distinctions are blurred and conceptually a large bank of high credit standing is on both sides of a LIBOR-LIBID deal at the same rate.
As there is no observed rate, informally LIBID is often taken as 1/8th % less than LIBOR.
In analogy with London Inter-Bank Offered Rate, LIBID is sometimes expanded as London Inter-bank Bid rate.
