SOFR likely to replace age-old LIBOR and be the new bellwether for pricing overseas money

January 28, 2021 0 By boss

[ad_1]

Mumbai Interbank Forwards Rate or MIFOR is a local gauge, which banks use for derivative or forward deals. It is derived by mixing LIBOR with a forward premium.

Synopsis

SOFR will likely be the new bellwether for Indian companies/banks pricing overseas money market/derivative deals or loans. That would replace the age-old London Interbank Offered Rate (LIBOR), a global borrowing gauge likely on its last legs.

MUMBAI: After the smokestack industries, it is time for India’s bulge-bracket banks to up the ‘atmanirbhar’ quotient. What would that entail? For starters, ditching a London benchmark to fix overnight rates in Mumbai.So, the Secured Overnight Funding Rate (SOFR) will likely be the new bellwether for Indian companies/banks pricing overseas money market/derivative deals or loans. That would replace the age-old London Interbank Offered Rate

  • GIFT ARTICLE
  • FONT SIZE
  • SAVE
  • COMMENT

Sign in to read the full article

You’ve got this Prime Story as a Free Gift

Already a Member?

Why ?

  • Sharp Insight-rich, Indepth stories across 20+ sectors

  • Access the exclusive Economic Times stories, Editorial and Expert opinion

  • Clean experience with
    Minimal Ads

  • Comment & Engage with ET Prime community

  • Exclusive invites to Virtual Events with Industry Leaders

  • A trusted team of Journalists & Analysts who can best filter signal from noise



[ad_2]

Source link