Pimco Says Libor Won’t ‘Simply Disappear’ After 2021 Deadline
Alert: HALISTER1
Source: BFW (Bloomberg First Word)
People
Jerome Schneider (Pacific Investment Management Co LLC)
Rick Chan (Pacific Investment Management Co LLC)
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UUID: 7947283
(Bloomberg) -- Libor is unlikely to “simply disappear” after 2021 given “the sheer volume of derivatives contracts and debt” currently tied to the benchmark, Pimco’s Rick Chan and Jerome Schneider write in blog post.
- Libor could survive “through oversight by a new regulatory body or by member banks,” but still expect increased use of benchmarks such as OIS, U.S. federal funds rate
- Near-term uncertainty about unwind “could increase spread volatility and create opportunities in products indexed to short-term rates”
- Investors should monitor situation as “transactable” benchmarks like repo rate and other replacements “gain traction”
- “We see a long road ahead before the BTFR will be fully deployed and widely used”
Alert: HALISTER1
Source: BFW (Bloomberg First Word)
People
Jerome Schneider (Pacific Investment Management Co LLC)
Rick Chan (Pacific Investment Management Co LLC)
To de-activate this alert, click here
To modify this alert, click here
UUID: 7947283