(Corrects direction in second paragraph.)
Dec. 29 (Bloomberg) -- The rate at which European banks say they see each other lending in euros for one week fell the most since June 2009, according to the European Banking Federation.
The euro interbank offered rate, or Euribor, for such loans dropped 13.2 basis points to 0.704 percent, EBF data showed. That’s the lowest level since March 2, and the biggest daily drop since June 25, 2009, according to data compiled by Bloomberg. A basis point is 0.01 percentage point.
The increase may be due to technical factors, according to Peter Chatwell, a fixed-income strategist at Credit Agricole Corporate & Investment Bank in London.
“Banks are now largely funded for year-end so you’re seeing one-week euribor rates slump,” Chatwell said.
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