Guidelines on domestic interest rate futures relaxed by RBI

Q.  The RBI relaxed guidelines on domestic interest rate for which category of instruments for banks?
- Published on 01 Nov 16

a. Futures
b. Stocks
c. Shares
d. Debentures

ANSWER: Futures
 
Guidelines on domestic interest rate futures relaxed by RBIThe Reserve Bank of India relaxed guidelines on what the domestic interest rate futures can be offered on 28th Oct, 2016.
  • This permits banks to hedge their short-term interest exposure.
  • Till now, the banks could not hedge their interest rate risk on active government bond benchmarks other than 91-day treasury bills.
  • Registered exchanges can select the underlying instrument or interest rate of new contracts subject to RBI approval, according to the central bank circular.

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