Current LIBOR rates
3 Month LIBOR Rate 0.25%
6 Month LIBOR Rate 0.43%
1 Year LIBOR Rate 0.97%
LIBOR rate is an acronym for the London InterBank Offered Rate. The LIBOR rate is defined as the wholesale lending rate between international banks in the London wholesale money market. It is the average interest rate banks are charging one another for unsecured loans in the interbank market at varying terms or maturities.
The LIBOR rate index is calculated by taking an average of market rate quotes from each member bank that participates in the survey.
This LIBOR rate is similar to the US fed funds rate though the LIBOR rate is not directly influenced by the European monetary authorities as the fed funds rate is and LIBOR rates can extend for periods of time that are much longer then US overnight fed funds rate.
The LIBOR rate is published and used as a benchmark for bank lending rates in the U.S and all throughout world financial markets. Numerous loan interest rates, such adjustable home mortgage rates, student loan rates, and business loan interest rates are based on the LIBOR rate.
LIBOR rates will fluctuate based on a number of market factors including interest rates on similar term securities, expectations of future interest rate movements, the financial soundness of banks engaged in LIBOR loans and overall liquidity in the London money market.