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RBI Delays Exchange-traded Derivative Rules Implementation Till May 3 – Prime Time News24


The RBI emphasised that the regulatory framework for ETCDs has remained constant over time and that there was no change within the central financial institution’s coverage strategy.

The RBI says it had permitted customers, for the benefit of doing enterprise, to take positions of as much as $100 million throughout exchanges with out offering documentary proof to determine the underlying publicity.

The Reserve Financial institution of India on Thursday delayed the implementation of its consolidated instructions for exchange-traded forex derivatives (ETCD) by a month, a transfer that ought to ease the panic seen out there this week.

The Indian rupee’s exchange-traded choices went right into a tizzy on Wednesday and Thursday after brokers requested shoppers to submit proof of underlying publicity on their by-product contracts or unwind their current positions, market contributors mentioned.

“In view of suggestions acquired and up to date developments, it has been determined that these instructions will now come into impact from Friday, Could 03, 2024,” RBI mentioned.

The central financial institution mentioned it had permitted customers, for the benefit of doing enterprise, to take positions of as much as $100 million throughout exchanges with out offering documentary proof to determine the underlying publicity.

Nonetheless, it didn’t present any exemptions from the requirement of getting the publicity, a requirement that has all the time existed.

The RBI emphasised that the regulatory framework for ETCDs has remained constant over time and that there was no change within the central financial institution’s coverage strategy.

“It prima facie seems to be like an extension in order that contributors have time to shut out their positions,” mentioned Abhilash Koikkara, head of foreign exchange and charges at Nuvama Skilled Shoppers Group.

“The notification explicitly mentions that change traded derivatives can solely be utilized by contributors having legitimate underlying (publicity). Nuvama will proceed to ask for an enterprise from its shoppers to indicate that they’ve contracted publicity.”

(This story has not been edited by Prime Time News24 employees and is printed from a syndicated information company feed – Reuters)

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