On July 7, the central bank raised the overnight borrowing rate by six percentage points to 30%.

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Short-term interest rates such as the overnight bank borrowing rate and one-month and one- year Treasury bill rates are already close to zero.

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The effect has been most dramatic in the overnight rate for borrowing dollars.

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In the current money market conditions, where banks have to approach the central bank for borrowing, the overnight lending rate is in fact the key operational policy rate.

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The British Bankers' Association said the interbank cost of borrowing overnight had fallen - a day after interest rate cuts and governments provided additional liquidity.

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