Signs of stress are appearing in money markets as traders struggle to gauge the impact of toughened Western sanctions against Russia on liquidity. The gap between future Libor and Fed rates -- the FRA/OIS spread -- widened 10 basis points for one-month contracts, the most since March 2020. Other key money-market indicators fluctuated, including three-month dollar-yen basis swaps, while March eurodollar contracts underperformed June peers. The moves may reflect traders’ concern that dollar funding costs could increase as tensions in Ukraine escalate. The decision to exclude various Russian lenders from the SWIFT ... (full story)