In the relinquishing of Libor, the sterling market has an edge over other currencies. Waiting in the wings, sterling has a rate with a 20-plus year history, one the market knows and is used to trading – Sonia, after all, has been around since 1997 and is already used to value around £30 trillion ($38 trillion) of assets a year.
The Bank of England-convened working group on sterling risk-free rates, in a mid-May statement, was breathless on the subject of Sonia’s popularity.
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