Global regulators set out plans to overhaul the way key financial benchmarks are calculated as they try to re-establish confidence in key market rates tarnished by manipulation scandals.

The Financial Stability Board said rates, particularly those such as Libor used to calculate interest rates, should be "to the greatest extent possible" based on actual trade data rather than employees' estimates, according to a statement published on its website today. The FSB, which consists of regulators and central bankers from around the world, also called for the development of alternative benchmarks.

The regulators are acting after traders at some of the world's biggest firms manipulated the London interbank offered rate by lying about their firms' true borrowing costs or colluding with colleagues at other firms to rig the benchmark for profit. They were able to succeed because the benchmark was based on guesswork about the cost of money rather than actual transactions between banks.