Sibor Rates Dropped to Lowest in 3yrs

At 1.7625% yesterday, the 3-mth Sibor (S'pore interbank offered rate) was at its lowest level since Feb 05, and is expected to go down further by mid-yr.

As Sibor is the rate which banks lend cash to each other, it thus affects loans such as mortgages, corporate & small business loans. But this fall would also mean that fixed deposit rates and banks' net interest margins would drop.

With savings interest rates so much lower than inflation (ie -ve real interest rates), it may be better not to keep money in the bank, and a better time to borrow.