NEW YORK, Sept 29 The cost to borrow three-month
U.S. dollars in the currency market jumped to its highest levels
in almost two months on Thursday as concerns grew about Deutsche
Deutsche Bank said on Thursday it was confident that the
vast majority of its trading clients understand the group has a
stable financial position, after Bloomberg reported that some
funds had withdrawn excess cash and positions held with the
Germany will not help ailing lenders such as Deutsche Bank,
senior lawmakers in Chancellor Angela Merkel's conservative bloc
said on Thursday, as resistance grew to any possibility of
staging a rescue.
The cost premium, measured by the three-month London
interbank offered rate on dollars over the three-month rate on
euros, was quoted about minus 53 basis points on Wednesday, the
highest since July 29, according to ICAP.
It was minus 33 basis points on Sept. 8.
The cross-currency basis swap is a measure of demand for
dollars, or an indicator of a surfeit of euros.
Banks and hedge funds use the swaps for currency bets, while
U.S. companies use them to hedge their non-dollar denominated
During the global credit crisis, demand for the greenback
soared as dollar lending came to a near halt with the
three-month basis swap spread hitting minus 305 basis points.
At the height of the euro zone crisis in 2011, the gauge was
at minus 160 basis points.
(Reporting by Karen Brettell and Richard Leong; Editing by