Sterling swaptions edge towards Sonia ahead of July deadline

Risk-free successor jumps to almost half non-linear activity, up from 20% in April

sterling flight

Sterling swaptions traders are confident the market will fully adopt the sterling overnight indexed average (Sonia) in time for a July 1 ban on non-linear Libor issuance, as activity linked to the alternative rate hit 45% in the first two weeks of May, thanks to a one-day flurry.

Almost £10 billion notional of swaptions referencing Sonia were reported to the Depository Trust and Clearing Corporation (DTCC) through May 16, roughly the same amount seen in the whole of April, when Sonia

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