Sonia users face three-way choice in term rate

Trio of rival forward-looking versions of sterling Libor successor set to be available

Bank of England notes

Sterling rate users face a choice of three competing term rates based on Sonia – a surprise to many industry participants who had expected the body in charge of sterling benchmark reform to recommend a single rate.

The news prompted one derivatives lawyer to say: “Wow. So you could have three different term rates? It’s hard enough as it is, and then you’ve got that as well.”

The Bank of England-convened working group on sterling risk-free reference rates announced in a statement on May 15 that

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