Asia awaits term SOFR solution for local benchmarks

Singapore, Thailand and Philippines look at ways to replace Libor in benchmark calculations

Asia’s benchmark administrators are closely watching efforts to establish a term version of US dollar Libor’s replacement, the secured overnight financing rate. The continuity of contracts that reference three South-east Asia interest rate benchmarks – and design of term risk-free rates in other Asia markets – might well depend on it.

A forward-looking term SOFR would allow the benchmark to be used instead of Libor to calculate contractual fallbacks for Singapore’s Swap Offer Rate (SOR), the