SOR rate has been appreciating for the past 1 month. In some days, it went even higher than Sibor. I met up with a friend who works in a reputable investment firm as a FX investment consultant to seek for advises. (I have my view of course, but just want to see if our views are in line)
SOR is related to US dollar. When Europe crisis got worse, many investor bought US dollars as it’s consider safe (safe because its still the reserve currency of many countries). However, US is also in trouble. It became a question of who is worst?
If Europe have more bad news = US dollar appreciate = SOR appreciate
If US have more bad news = US dollar depreciate = SOR depreciate
However, US dollar is still weak and SOR is unlikely to appreciate much more. For clients who have home loan pegged to SOR, do not worry!
Disclaimer: Just my personal view