Yesterday's Wall Street Journal featured the story, "Companies Look to Libor for Debt Savings as Rates Rise." The somewhat odd piece claims that companies are shifting funding from that linked to 3-month LIBOR to those linked to 1-month LIBOR. It explains, "Companies are making a mad dash to save money in the debt markets as rising short-term interest rates increase their borrowing costs. One place that's increasingly apparent is the market for corporate loans, where companies that can are tying their floating-rate debt payments to benchmarks that are rising at a slower pace. The rejiggering among companies comes as rates have climbed this year, spurred by increases from the Federal Reserve, expectations for a pickup in inflation and an increase in government debt sales to fund last year's tax-cut package. The rate at which banks lend to each other for three months has been rising much faster than the rate at which they lend for one month, pushing the gap in April between the two to its widest since 2009. The three-month U.S. dollar London interbank offered rate has climbed 0.62 percentage point this year to 2.32%, while the one-month counterpart has climbed a comparably meager 0.41 point to 1.98%." The Journal adds, "For years after the financial crisis, the Fed's easy-money policies pushed all short-term rates down, leaving little daylight between the costs of borrowing for one month versus three months. But the central bank is set to raise rates in June for the seventh time this economic cycle and analysts say one or two more increases may be in store in 2018. The shift among benchmarks may hold clues for how companies adjust to another change coming to the short-term rates market: Regulators are encouraging Wall Street to reduce its reliance on Libor altogether, and instead peg loans and derivatives to a new rate that the Federal Reserve Bank of New York began publishing earlier this year."

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