TED spread: Difference between revisions
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imported>Doug Williamson (Create page. Sources: BIS Quarterly Review, March 2019, Investopedia webpage https://www.investopedia.com/terms/t/tedspread.asp) |
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Revision as of 07:48, 3 April 2019
Credit risk.
TED is an acronym for Treasury EuroDollar rate.
TED spread is the difference (spread) in interest rates between:
- US government 3-month borrowing rates, considered effectively risk-free; and
- 3-month interbank interest rates, such as 3-month US dollar LIBOR
The greater the TED spread, the greater the measure of credit risk on the banks in the interbank market.
