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Bank of England (via Public) / The FCA and the Bank of England encourage market participants in a switch to RFRs in the LIBOR cross-currency...

The FCA And The Bank Of England Encourage Market Participants In A Switch To SONIA In The Sterling Exchange Traded Derivatives Market From 17 June


The FCA And The Bank Of England Encourage Market Participants In A Switch To SONIA In The Sterling Exchange Traded Derivatives Market From 17 June
Date
13/05/2021
Following close engagement with market participants, the FCA and Bank of England support and encourage market users and liquidity providers in the sterling exchange traded derivatives market to switch the default traded instrument to SONIA instead of LIBOR from 17 June this year. This is to facilitate a further shift in market liquidity toward SONIA, bringing benefits for a wide range of users as they move away from LIBOR.
 
Statement
A key milestone recommended by the Working Group on Sterling Risk-Free Reference Rates (‘the Working Group’) is to cease initiation of new GBP LIBOR exchange traded derivatives expiring after 2021 by end-Q2 2021, other than for risk management of existing positions. The Working Group milestones have supervisory backing from the PRA and FCA as set out in t ....

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