SOFR adoption stalls after US Libor delay

Stay of execution, RFR illiquidity and fallback reliance slow SOFR adoption

SOFR-adoption-stalls

The derivatives market’s transition to the secured overnight financing rate (SOFR) has stalled since regulators granted US dollar Libor an 18-month reprieve, with traders blaming poor liquidity and the industry’s reliance on new fallback language for a dearth of new swaps linked to the successor rate since November.

Five of the most heavily used US dollar Libor fixings will survive until mid-2023, but regulators have insisted that no new Libor risk should be traded after the end of 2021, when

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