A proposed calculation method was circulated for comment on 14 September 2020. Norges Bank received and took note of feedback on the proposal from the working group on alternative reference rates. The Nowa compounded index and average will therefore be modified somewhat compared with the consultation proposal:

• The start value of the Nowa compounded index will be changed from 1 to 100.00000000. The number of decimal places in the index will be changed from ten to eight, which provides the same precision as in the proposal.
• Compounded Nowa averages will be changed to reflect tenors already known to the market from Nibor. Averages for one-, three- and six-month tenors will be published. The tenors will be adjusted so that start and end dates always fall on business days.
• To provide market participants with sufficient time to make interest payments, the compounded Nowa average will be published with a two-day observation shift. This means that the average is calculated based on Nowa in an observation period shifted two days back relative to the tenor. The interest rate is published on the last day of the observation period. The average rates will be published to five decimal places.

More information on the Nowa compounded index and the Nowa averages will be available in 2021 Q1.