On 26 September 2022, the Working Group on Euro Risk-Free Rates published a recommendation detailing a recommendation relating to the availability of derivative products referencing Euro short-term rates (€STR), particularly those that will be utilised for the purpose of calculating and publishing a forward-looking term €STR in order to support the adoption of EURIBOR fallback.

The document makes the following recommendations:

• For all market making institutions, all reasonable steps should be taken to make derivatives referencing the €STR benchmark available to customers.
• For all market participants transacting in derivatives referencing Euro denominated benchmarks, there should be an assessment whether €STR would be a suitable benchmark for their needs and where relevant, taking the necessary steps to be able to transact accordingly, including the adoption or development of the necessary infrastructure.

Additionally, while these recommendations apply to derivatives referencing Euro dominated benchmarks, the further development of €STR in products that are utilised as inputs into the calculation and provision of €STR term rates will contribute to a more robust forward looking term version of €STR that can also be utilised in the adoption of the €STR based fall-back recommendations published 11 May 2021.

Finally, market participants are reminded that backward looking rates such as compounded €STR average rates are already available for all products including loans, bonds and other cash instruments.