Americas

Tradition SOFR Indicative Rates Service

TraditionDATA, along with data from Bank of New York Mellon, have launched a data service that provides an intraday “day-ahead” insight into the level at which the Federal Reserve Bank of New York SOFR Rate is likely to be published tomorrow.

Why is this important? : Given the loss of confidence in LIBOR as the benchmark daily rate set for USD short term rates, the Federal Reserve convened the industry wide Alternative Reference Rates Committee (ARRC) which in 2017 identified SOFR as its preferred LIBOR replacement. At the Financial Stability Oversight Council (FSOC) Principals Meeting on June 11, 2021, regulators reinforced the need to move from USD LIBOR to alternative reference rates, with a focus on SOFR. Trading in financial instruments linked to SOFR, both cash and derivatives, has been gaining traction and SOFR now forms an important part of the USD rates market structure.

 

SOFR BNYM sell sheet thumb

TraditionDATA SOFR Indicative Rates Service