The European Insurance and Occupational Pensions Authority (EIOPA) published its calculation of the Ultimate Forward Rate (UFR) for 2027, keeping applicable UFRs unchanged for all relevant currencies except the Chinese renminbi (yuan). The applicable UFR for the euro remains 3.30% for 2027, while the renminbi-yuan UFR falls by 15 basis points to 4.05%. The report attributes the single change to the renminbi-yuan’s expected inflation rate moving from 3% to 2%, while the expected real rate used across currencies remains 1.20% after applying EIOPA’s rounding approach. EIOPA notes the overall impact should be non-material given the small share of technical provisions denominated in CNY (0.135% for solo undertakings and 0.014% for groups, based on 2024 data). The new UFRs will be used in the calculation of risk-free interest rates from 1 January 2027.
European Insurance and Occupational Pensions Authority2026-03-30
European Insurance and Occupational Pensions Authority publishes 2027 Ultimate Forward Rate keeping the euro at 3.30% and cutting the renminbi-yuan to 4.05%
The European Insurance and Occupational Pensions Authority published its Ultimate Forward Rate calculation for 2027, keeping all applicable UFRs unchanged except for the Chinese renminbi (yuan), which is reduced by 15 basis points to 4.05%. EIOPA attributes the renminbi-yuan adjustment to a lower expected inflation rate and expects the impact to be non-material given the limited share of technical provisions denominated in CNY.