Term SONIA reference rate

Interest rates - reference rates - forward-looking benchmarks - SONIA.

(TSRR).

Term SONIA refers to a forward-looking benchmark interest rate, based on the Sterling Overnight Index Average (SONIA), as published by the Bank of England.

Term SONIA will have only limited application - UK RFRWG

"The UK RFRWG has repeatedly emphasised their expectation that the bulk of the cash markets should transition to backward-looking RFRs and should not wait for term rates...

The UK RFRWG believes term SONIA is likely to be appropriate only in limited instances where operational necessity precludes the use of a compounded in arrears RFR or another alternative rate."

A practical guide to LIBOR transition - Slaughter and May - September 2020, p11

See also

• Bank of England
• Bank of England Base Rate
• Benchmark
• Compound
• Currency
• Risk-free rates (RFR)
• SONIA
• Term
• Term fixing
• Term rate
• The Working Group on Sterling Risk-Free Reference Rates (RFRWG)