What is happening with EURIBOR?

In the case of EURIBOR, recent developments in the Eurozone have modified expectations as to its transition. Most significantly, it is anticipated that EURIBOR will remain, calculated on its revised methodology and in a Benchmark Regulation-compliant form.

That being said, there is some market doubt as to whether there will be sufficient liquidity (reference transactions) for it to be a sustainable or even credible rate in the longer term. European regulators and the euro rate working groups recommend enhanced fallbacks for EURIBOR referencing instruments, including fallbacks to risk-free rates (ESTER etc.). It is likely that for a majority of products/instruments a global switch over to overnight risk-free rates will see a greater take up of ESTER in the euro market, with EURIBOR remaining relevant for a narrower section of the market.