Libor stays high despite base-rate cut

The Libor three-month rate at which London banks lend pounds to each other was fixed at 6.24875% against 6.26875% yesterday.

Today's rate remains worryingly high, especially after last week's co-ordinated half-point cut in base rates by the Bank of England and the world's major central banks.

In normal times Libor would stay close to the new 4.5% base rate. The good news is interbank lending of dollars is down significantly, falling 30 basis points from Friday's close.