Jerome H Powell: Introductory remarks

Speech (via prerecorded video) by Mr Jerome H Powell, Member of the Board of Governors of the Federal Reserve System, at the Roundtable of the Alternative Reference Rates Committee, The Federal Reserve Bank of New York, New York City, 2 November 2017.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Good morning.  I am sorry that I am not able to be with you today at the FRBNY for this important meeting.  I thought that I would begin by discussing the LIBOR related events that have brought us here, and then talk about the way forward.  

LIBOR gained negative public attention when reports began to surface during the financial crisis that employees at some banks had attempted to manipulate the rate by altering the quotes they submitted for use in the calculation of LIBOR.  A number of agencies,  including the Commodity Futures Trading Commission (CFTC), the Department of Justice, and the U.K. Financial Conduct Authority (FCA), took the lead in investigating and prosecuting the cases of LIBOR manipulation that were uncovered.  The Federal Reserve also joined in international efforts to strengthen LIBOR.  Among other things, we joined the ICE Benchmark Administration's (IBA's) LIBOR Oversight Committee as an observer, and we also worked intensively with international authorities and IBA in developing and encouraging the reforms set out in IBA's Roadmap for LIBOR.