UK’s Most Important Market Rate Has Never Been So Stable
- SONIA has been unchanged at 5.2000% for over a month
- Market rates have been climbing as BOE shrinks bond holdings
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The average interest rate that UK banks borrow sterling overnight from other financial institutions at has been unchanged for the longest stretch on record as it converges with the Bank of England’s own policy rate.
The Sterling Overnight Index Average, or SONIA, has been stable at exactly 5.2000% each day since May 7 — or 28 business days — something that’s never happened since it was created in 1997. The longest previous streak was a mere four days.