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swaps use some form of Libor as a reference rate.
So why on earth is this critical reference rate not centrally regulated?
It has been estimated that $250tn of swaps use some form of Libor as a reference rate.
The yuan is still only allowed to fluctuate up or down 2% on either side of the reference rate.
Libor is used as the reference rate for loans and financial derivatives worth more than $300 trillion £186 trillionn).
It is the reference rate for more than $10 trillion in loans".
This latter depends on the reference rate and its compatibility with the actuator saturation constraint.
The Monetary Policy Council, which is led by the central bank, lifted the seven-day reference rate a quarter-point, to 4.5percentt.
China cut the reference rate for its currency for the third straight day on Thursday, after the surprise devaluation of the yuan this week unsettled global financial markets.
China keeps a tight grip on the yuan, allowing it to fluctuate up or down just 2% on either side of the reference rate, which it sets daily.
The daily reference rate was set at 6.3975 yuan to $1 giving the currency a slightly stronger rate than the 6.4010 set the previous day.
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