The interbank lending rate on three-month loans in dollars - known as the London Interbank Offered Rate, or Libor - dipped 0.01 percentage points to around 1.41 per cent, according to the British Bankers' Association.

Meanwhile, the rate for three-month loans in euros - known as the European Interbank Offered Rate, or Euribor - decreased around 0.04 percentage points to 2.78 per cent. The equivalent rate for pounds also fell 0.04 percentage points to around 2.61 per cent.

Interbank rates are important because they affect the cost of loans in the wider economy, for both businesses and individuals.

Rates have been high in recent months as banks have hoarded cash and worried that other lenders might collapse and not pay them back.

All three lending rates remain above their benchmarks set by central banks - 0-0.25 per cent in the US, 2.00 per cent in Britain and 2.50 per cent in the 16-nation euro zone. Both the European Central Bank and the Bank of England are widely expected to cut rates again this month, starting with the Bank of England on Thursday. -- AP