The Reserve Bank of India (RBI) has permitted the select banks in India can offer forex rates to Indian clients round the clock, which is 24X7. Now the select banks can work beyond the inter-bank market hours, which now run from 9 am to 5 pm.
♦ The move will allow the Indians to hedge their foreign exchange risks at any time of the day.
♦ It will make the offshore currency markets in Dubai and Singapore less attractive for Indian investors.
♦ RBI has also decided to accept the recommendation of the task force on the offshore rupee market. Hence it permits the authorized dealers Category-I banks to offer foreign exchange prices to users at all times either by a domestic sales team or through their overseas branches.
♦ This allows transactions with person resident outside India, through their foreign branches and subsidiaries can be undertaken beyond onshore market hours.
♦ It benefits the bank’s clients to manage overnight currency risk as they can now hedge beyond local market hours.