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Will LIBOR still be published?

Published in LIBOR Cessation 3 mins read

No, LIBOR is no longer published, and the last remaining settings are scheduled to permanently cease very soon.

The Permanent Cessation of LIBOR

The London Interbank Offered Rate (LIBOR), once a foundational benchmark for global financial markets, has reached the end of its publication. All 35 LIBOR settings have now permanently ceased to be published and are no longer available for use. This marks a significant transition in the financial landscape.

Key Dates in the Transition

While most LIBOR settings ceased publication at the end of 2021, the final stage of the transition involves certain US Dollar (USD) LIBOR settings. The 1-month, 3-month, and 6-month US Dollar LIBOR settings are the last remaining iterations and will permanently cease to be published effective from October 1, 2024. After this date, no LIBOR setting will be available for use.

Below is an overview of the complete cessation:

Overview of LIBOR Cessation

LIBOR Setting Category Cessation Status/Date
All other 32 LIBOR settings Permanently ceased prior to 2024
1-month, 3-month, 6-month US Dollar LIBOR Permanently ceased as of October 1, 2024

This table illustrates the comprehensive nature of LIBOR's discontinuation, ensuring that by October 2024, all its forms will have officially ended.

Why LIBOR Ceased

The decision to discontinue LIBOR stemmed from several critical issues, primarily its susceptibility to manipulation and the decline in the underlying interbank lending transactions it was designed to measure. As a rate often based on expert judgment rather than solely on observable transactions, it lacked the robustness required for such a widely used benchmark. Regulators globally pushed for a transition to more reliable, transaction-based alternative reference rates (ARRs).

The Transition to Alternative Reference Rates (ARRs)

The financial industry has diligently worked to transition away from LIBOR to more robust, transaction-based rates.

What Replaced LIBOR?

Risk-Free Rates (RFRs) have largely replaced LIBOR across various currencies. These rates are more resilient and less prone to manipulation as they are derived from active, liquid overnight lending markets. Key examples include:

  • SOFR (Secured Overnight Financing Rate): The primary replacement for US Dollar LIBOR.
  • SONIA (Sterling Overnight Index Average): The replacement for GBP LIBOR.
  • SARON (Swiss Average Rate Overnight): The replacement for CHF LIBOR.
  • Tibor (Tokyo Interbank Offered Rate) / TONAR (Tokyo Overnight Average Rate): Replacements for JPY LIBOR.
  • EURIBOR (Euro Interbank Offered Rate) / ESTR (Euro Short-Term Rate): Replacements for EUR LIBOR.

Impact on Financial Markets

The transition away from LIBOR has been a monumental undertaking, impacting a vast array of financial products, including:

  • Derivatives: Swaps, options, and futures contracts have shifted to ARRs.
  • Loans: Corporate, syndicated, and retail loans now reference ARRs.
  • Bonds: Floating-rate notes and other debt instruments are now indexed to ARRs.

This comprehensive shift has largely been smooth, demonstrating the financial industry's capacity to adapt to significant regulatory and market changes. The cessation of LIBOR ensures a more reliable and transparent foundation for global financial contracts moving forward.