Dec. 13 (Bloomberg) -- The cost for European banks to borrow in dollars rose to the highest in two weeks, according to money-market indicators.
The three-month cross-currency basis swap, the rate banks pay to convert euro payments into dollars, was 128 basis points below the euro interbank offered rate at 8:13 a.m. in London. It has widened by 19 basis points since Dec. 8, when Europe’s leaders met in Brussels to address the region’s debt crisis.
The one-year basis swap was at 90 basis points under Euribor from minus 89 basis points yesterday, data compiled by Bloomberg show. A basis point is 0.01 percentage point.
A measure of banks’ reluctance to lend to one another in Europe rose. The Euribor-OIS spread, the difference between the borrowing benchmark and overnight index swaps, was at 95.5 basis points from 94.6 yesterday.
Lenders increased overnight deposits at the European Central Bank, placing 346 billion euros ($457 billion) at the Frankfurt-based ECB yesterday, from 335 billion euros on Dec. 9. That’s the most since June 2010 and compares with a year-to-date weekly average of 89 billion euros.
--Editors: Andrew Reierson, Cecile Gutscher
To contact the reporter on this story: Namitha Jagadeesh in London at email@example.com
To contact the editor responsible for this story: Paul Armstrong at firstname.lastname@example.org