Introduction on benchmarks

Benchmarks have various purposes: they are resorted to in order to assess the performance of an investment fund, to determine the amount payable under a financial instrument or financial contract, or to fix the value of a financial instrument. Significant cases of interest rate benchmarks’ manipulation have brought to light the importance, but also the vulnerabilities of benchmarks used for the pricing of financial instruments and contracts. LIBOR scandals have shown that doubts about the integrity of benchmarks could undermine market stability. As a response, the EU Market Abuse Regulation laid down specific sanctions for benchmark manipulation, while the European Regulation on indices strengthened benchmarks produced and used in the European Union.