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BSE launches currency futures trading

SEBI, RBI in discussion to bring further relaxation in trading norms

— PHOTO: PAUL NORONHA

TRANSPARENT AND EFFICIENT: C. B. Bhave, Chairman, SEBI, striking the gong to launch the BSE currency derivatives segment (BSE-CDX) in Mumbai on Wednesday. Shyamala Gopinath, Deputy Governor, Reserve Bank of India, looks on.

MUMBAI: Asia’s oldest bourse Bombay Stock Exchange (BSE) on Wednesday launched the currency derivatives segment (BSE-CDX) that would enable participants to hedge their currency risks through trading in the U.S. dollar-rupee future platform.

The National Stock Exchange (NSE) had kicked off exchange-traded currency futures for the first time in the country on August 29, while leading commodity bourse Multi Commodity Exchange of India (MCX) is expected to launch the facility soon.

MCX had secured the in-principle nod for starting currency futures trading in August. Earlier, participants had to depend on over-the-counter (OTC) products such as forwards, swaps and options to hedge their currency risks.

Security and Exchange Borad of India Chairman C. B. Bhave inagurated the BSE-CDX platform.

The market regulator and the Reserve Bank of India were in discussion to bring about further relaxation in the currency trading norms, Mr. Bhave said. The regulators had been trying to ensure transparency and timely settlement of transactions that were essential to develop a healthy financial system, Mr. Bhave said.

“We have been trying to bring in assurance of settlement and transparency in the market... the present financial crisis in global markets is an outcome of lack of faith on these principles,” Mr. Bhave said.

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