Finally, you can take a deep breath and relax, and not just because it is holiday time. Credit spreads seem to have settled in for good.

Both the TED and the Libor-OIS spreads have come to rest within a relatively narrow range. For the TED — the measure of the difference between three-month Treasurys and the three-month Libor rate – the range is between 20 and 25 basis points since early October. The Libor-OIS, which measures the difference between the three-month Libor rate and the anticipated average of the federal funds rate, has ranged within 8 and 14 points since then. There hasn’t been this level of consistency in credit prices since before the credit crisis hit in 2007.

Today the TED is at 21.27, about 1.9% tighter; LIBOR-OIS is hovering at 9, about 0.95 points higher.

TED SPREAD

LIBOR-OIS SPREAD

And I don’t see credit prices changing through the end of the year. It’s holiday time, after all. Time to see the family and enjoy the season. And really, is there a better holiday gift for banking than stable credit prices?

(That question was not directed at Ken Lewis.)