Libor Was Largely Guesswork at the Height of Volatility in March
- Banks leaned on ‘expert judgment’ over actual data, BOE says
- The benchmark is being phased out over the next 18 months
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At the peak of the pandemic-induced market meltdown, guesswork played a vital role in setting international borrowing costs.
Transactional data used to calculate sterling Libor all but vanished as markets became volatile in March, reinforcing the case for abandoning the benchmark, Bank of England Governor Andrew Bailey said in a speech on Monday.