The Reserve Bank of India (RBI) could allow banks to offer foreign currency-rupee options to corporate clients by April, according to a bank official.“We are actively considering the prospect of banks based in India being permitted to offer foreign currency-rupee options to Indian corporates as a risk management product,” said the official. But the RBI would introduce the options in a controlled manner: “In the process the banks would be allowed to run an options book in a limited way.”
The official said there is not yet a firm time-frame for the approval of foreign currency-rupee options, but added that a realistic estimate would be April.
The RBI currently only allows companies to use forwards and long-term currency swaps in order to hedge their risks.
More on Foreign Exchange
Target redemption forwards with capped loss structure set for launch
CNT fixing will be a boon for Taiwan’s derivatives market
Change in regulations will allow corporates to sell forex options
Importers will increase hedging activity amid greater rupiah volatility
Sign up for Risk.net email alerts
Nominated for two technology awards
Nominated for post trade technology award
Sponsored webinar: Collateral and counterparty tracking
Isda directors warn on fragmentation, access and liquidity - but expect problems to pass
There are no comments submitted yet. Do you have an interesting opinion? Then be the first to post a comment.