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Bank lending still jammed

Banks are continuing to charge high rates to lend to each other despite global efforts to unjam money markets.

Overnight, inter-bank lending costs fell to 5.43% from 5.6%, but they remain almost 1% above the Bank of England's official 4.5% base rate.

In normal market conditions, the figure would be near base rate. The cost of three-month lending, a key rate for pricing mortgages, fell 0.02% to 6.25%.

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