The Bank Bill Swap Rate (BBSW) is the benchmark interest rate for Australian dollar-denominated debt securities. It is used as a reference rate for pricing debt securities, collateralized debt obligations, interest rate swaps, and other derivatives contracts.
The BBSW is calculated by the Australian Financial Markets Association (AFMA) on behalf of the Reserve Bank of Australia (RBA). It is based on the weighted-average of bids and offers submitted by a panel of banks active in the Australian wholesale money market.
The BBSW is published every business day at 11:30 am Sydney time. It is available on the AFMA website and on the RBA website.
What is a bank bill in Australia?
In Australia, a bank bill is a negotiable instrument that represents a debt obligation incurred by a borrower from a lender. The borrower is typically a financial institution, such as a bank, and the lender is typically an investor, such as a pension fund. The debt obligation is typically for a period of one year or less.
What moves the Bbsw?
Bbsw is an acronym for the Bank Bill Swap Reference Rate, which is the benchmark interest rate for Australian dollar-denominated derivatives. The rate is set daily by the Australian Financial Markets Association (AFMA), and is used as a reference rate for a variety of derivative instruments, including interest rate swaps, interest rate options, and floating rate notes.
The Bbsw is determined by a panel of banks which submit rates for 1-month, 3-month, and 6-month tenors. These rates are then averaged to produce the Bbsw fixing. What was the highest interest rate in Australia? The highest interest rate in Australia was 10.75% which was reached in 1989.
What is the 5 year swap rate today? The 5 year swap rate today is the rate at which two parties agree to exchange payments on a fixed-for-floating basis over a period of five years. The floating leg of the swap typically pays a LIBOR-based rate, while the fixed leg pays a rate based on the swap's agreed-upon notional amount. What is benchmark interest rate? Benchmark interest rates are important for both borrowers and lenders. The benchmark rate is the rate that a financial institution uses as a reference point for pricing products and services. For example, a bank may use the prime rate as its benchmark rate. This means that when the bank is pricing a loan, it will use the prime rate as a starting point. The bank may then add a margin to the prime rate to arrive at the final interest rate for the loan.