"Libor is set by a panel of banks in a daily survey by the British Bankers' Association at about noon in London. Members provide estimates on how much it would cost to borrow in 10 currencies for terms from a day to a year. The Bank for International Settlements said in March some lenders may have ``manipulated'' rates to keep from appearing like they were in financial straits. " http://www.bloomberg.com/apps/news?pid=20601087&sid=a_MW4IciV.rc&refer=home ( Bloomberg.com )
I can remember when the gold price was set by a group of London dealers, and I wonder if we're seeing a relic from time gone by?
Why isn't the LIBOR rate ( London Interback Offered Rate ) set by the free market?
Don't forget that today is an options expiration day and things could be nuts on the trading floors, as if they haven't been lately.