The cost of insuring against default on financial debt fell to the lowest in two weeks amid optimism the European Central Bank's cash injection will ease bank stress and after data signaled the U.S. economy is strengthening.
The Markit iTraxx Financial Index of credit-default swaps on the senior debt of 25 European banks and insurers fell for a fourth day, dropping 10.5 basis points to 280, according to JPMorgan Chase & Co. at 2 p.m. in London. A decline signals improvement in perceptions of credit quality.
The U.S. economy expanded 1.8 percent in the third quarter compared with a year earlier, down from the 2 percent estimated last month though still faster than in much of recession-hit Europe. European Central Bank President Mario Draghi is speaking today after the Frankfurt-based ECB lent the region's banks 489 billion euros ($639 billion) in three-year loans, almost double the amount forecast by economists.
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