LIBOR: What it is, how it's used and future phaseout - Business Insider

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The LIBOR is a global interest rate that affects the rates of many loans and investments. Here's how it's set, and why it's slated to end

Of all the LIBOR reference rates, the most significant and commonly quoted is the US Dollar Three-Month rate. It is usually referred to as the current LIBOR. Ordinary individuals and most companies don't get charged LIBOR rates. But the LIBOR does act as a benchmark for many consumer loans, investments, and other financial products, somewhat like theThe early 1980s saw the development of a whole host of investments based on interest rates and currency exchanges.

It grew to become a respected benchmark all over the world—until 2012, when news broke that bankers had been rigging rates for years, mainly to help their derivatives traders.

 

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