Britain's government is expected to spell out on Monday the scope of a root and branch reform of Libor, the interest rate benchmark that was rigged by Barclays in a widening scandal that has damaged London's standing as a finance centre.
The UK Treasury is set to announce the remit for a review of the rate at which banks are willing to lend to one other that is being carried out by Martin Wheatley, a top official at the UK's Financial Services Authority regulator.
Wheatley will look at how Libor is set and whether it should be based in future on actual transactions. He will also look to reform how the rate setting process is governed and how it should be supervised in future.
Currently, the rate is self-regulated by its sponsor, the British Bankers' Association, a situation which has sparked a transatlantic blame game.
Regulators have been fending off accusations from policymakers that they failed to take action when the rate did not appear to work during the 2008 financial market meltdown, one of the periods covered in a settlement with the authorities under which Barclays paid a record fine.
Wheatley has said he would look at other market benchmarks which are not directly supervised, without mentioning names.
Market participants say he could look at benchmarks in the energy markets, which the European Union's executive European Commission said this week it will also review as part of its own deepening probe into interest rate benchmarks.
The BBA was already reviewing Libor before the Barclays fine was announced. That review is set to be folded into Wheatley's work. He is expected to come forward with draft recommendations around August 10 to a short public consultation.
His final proposals, due at the end of the summer, are expected to be inserted into the financial services bill now working its way through parliament to put in place next year a new system of financial supervision in Britain.
The overhaul will see the FSA being replaced with a prudential regulator at the Bank of England and a new stand alone Financial Conduct Authority that Wheatley will head.
FSA Chairman Adair Turner said this week that Libor setting was now as honest as it could get but that the structure of the rate setting needed changing.