Quarles’ plan for legacy Libor contracts stirs confusion

Cryptic comment feeds speculation about synthetic US dollar Libor – prompting pushback from ARRC

Photo of Randal Quarles
CNP/SIPA USA/PA Images

A senior Federal Reserve official’s comments last week, suggesting the central bank was working on a plan to deal with legacy US dollar Libor contracts, have been met with confusion within the industry – and concern that it might undermine the push for a legislative solution to the problem.

At a Senate banking committee hearing on November 10, Randy Quarles, the Fed’s vice-chair for supervision, said the central bank was working on a “mechanism” to allow so-called tough legacy contracts that

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