Historical LIBOR rates have varied since their introduction in 1986, as rates are based on different currencies and maturities. Three-month LIBOR rates based on the U.S. dollar ranged from 10.3 percent in March 1989 to 0.22 percent in May 2014, according to the Federal Reserve Bank of St. Louis, one of many sites that provide historical LIBOR interest rates.
The London Interbank Offer Rate (LIBOR) is a fundamental benchmark for financial markets in the United Kingdom and worldwide. Financial markets use LIBOR to set settlement prices for major financial derivative contracts, and banks use LIBOR as the base rate for consumer financial products such as mortgages and student loans.
LIBOR represents the interest rate that banks would pay to borrow from each other on an unsecured basis for a loan of a particular maturity (overnight, 1 week, 1 month, 3 months, six months, 12 months) and in a particular currency (the U.S. dollar, the British pound, the euro, the Japanese yen, and the Swiss franc). Intercontinental Exchange, the LIBOR administrator, polls its panel of major investment banks each U.K. business day to determine at which rates it could borrow funds for those given maturities and currencies, provides a trimmed arithmetic mean of each rate and publishes 35 different reference rates.
Many estimates suggest that the value of financial products with interest rate terms tied to LIBOR is in the hundreds of trillions of dollars.