## What is a LIBOR forward curve?

The Forward Curve is the market’s projection of LIBOR based on Eurodollar Futures and Swap data. The forward curve is derived from this information in a process called “bootstrapping”, and is used to price Interest Rate Options like Caps and Floors, as well as Interest Rate Swaps.

## Is there a SOFR forward curve?

The Secured Overnight Financing Rate (SOFR) forward curve represents the implied forward rate based on SOFR futures contracts and other SOFR-indexed financial instruments.

**Is LIBOR forward-looking?**

For example, LIBOR is a forward-looking term rate, which means that the LIBOR rate for an interest period or calculation period is set at the start of that period, with payment due at the end. As such, this provides certainty of funding costs to assist cashflow management.

### What is replacing the LIBOR?

Effective December 31, 2021, Libor will no longer be used to issue new loans in the U.S. It is being replaced by the Secured Overnight Financing Rate (SOFR), which many experts consider a more accurate and more secure pricing benchmark.

### What is the LIBOR forward curve?

Last Update: 3/23/2022 The Forward Curve is the market’s projection of LIBOR based on Eurodollar Futures and Swap data. The forward curve is derived from this information in a process called “bootstrapping”, and is used to price Interest Rate Options like Caps and Floors, as well as Interest Rate Swaps.

**What is the’LIBOR curve’?**

What is the ‘LIBOR Curve’. The LIBOR curve is the graphical representation of various maturities of the London Interbank Offered Rate (LIBOR), which is the short-term floating rate at which large banks with high credit ratings lend to each other. The LIBOR curve is usually depicted for short-term periods of less than one year.

#### What is the forward curve and how is it used?

The Forward Curve is the market’s projection of LIBOR based on Eurodollar Futures and Swap data. The forward curve is derived from this information in a process called “bootstrapping”, and is used to price Interest Rate Options like Caps and Floors, as well as Interest Rate Swaps.

#### What is the difference between SOFR and Libor?

Both curves reflect future expectations of Federal Open Market Committee (FOMC) policy, but LIBOR is a forward-looking term rate while SOFR is an overnight rate. LIBOR also includes a component of credit risk not inherent in SOFR. Forward curves are often useful for forecasting and underwriting floating-rate debt.