LIBOR off the charts

Banks are still hesitant to lend to each other, as the latest LIBOR fixings make abundantly clear. The chart above shows overnight, U.S. dollar LIBOR rates, which shot up from 2.31% on Friday to 2.57% yesterday and a whopping 6.88% this morning. Three-month (4.05%) and six-month LIBOR (3.98%) are also on the rise and well above the federal funds rate target (2%).