At the start of last week the rate stood at 5.77%, so as a result of the 1.5% in base rates the Libor has gone down by 1.27%, giving lenders the chance to cut rates. The overnight Libor rate has now fallen to 3.21%.
The British Bankers Association (BBA) said: "Following yesterday's dramatic interest rate cut from the Bank of England high street banks have today responded by cutting their borrowing rates."
BBA Chief Executive Angela Knight said: "The banking industry recognises that government wants strong banks and is grateful for the support we have had. Banks are committed to doing their part to help rebuild the UK economy as well as ensuring we help and support all our customers - both lenders and savers."
"We know that many people are concerned about making ends meet in these difficult times and although the interest rate cuts will be welcomed by borrowers and home owners the banks have to balance the borrowing rates against offering competitive rates for savers. We urge any customer facing money trouble to speak to the bank sooner rather than later so we can work together to help find a solution in everyone's interests."
