After 3 Month Euribor dipped on Friday for the first time in 3 months from a 2010 high of 0.899% to 0.896%, the critical interbank lending metric has once again resumed its steady advance higher, with the August 2 fixing coming in at 0.898%. And as has been postulated previously, a rise in overnight funding immediately leads to a rise in various EUR pairs. At last check the EURUSD was up to $1.3071, as the pair mimics each tick in (deteriorating) money market conditions.
From from Dow Jones:
The cost of borrowing euros in the interbank market ticked slightly higher Monday, having fallen for the first time in over three months on Friday.
The three-month Euro Interbank Offered Rate, or Euribor, the rate at which interbank term deposits in the monetary union are offered, rose to 0.898% Monday from 0.896% Friday, when it had fallen for the first time since April 20.
Euribor is tracked more widely than its London Interbank Offered Rate euro counterpart, and is used to benchmark a wider range of assets.
Erste Bank in Vienna offered a rate of 0.95% while Allied Irish Banks and DZ Bank quoted a rate of 0.94%. HSBC offered the lowest rate of 0.81%.