Currency futures: a study for Indian markets

Abstract

The financial players in the currency market in India today have a range of over as swaps, options and forwards to help them mitigate currency still need arises for continued development of Indian markets to offer a wider choice of such hedging instruments. In the context of proposed capital account liberalisation, the Reserve Bank of India (RBI futures to be introduced in India.. South Africa, albeit having capital controls have successfully introduced currency futures recently at Johannesburg Stock Exchange. As RBI has paved the path for similar introduction in India, it would be interesting to study how it would affect the players concerned with currency risk, such as the services sector, banking sector and the export over-the-counter (OTC) products such risk. These markets are quite deep and liquid, but RBI) feels a need for currency export-import industry.