RBI announces more actions amid rupee depreciation

Amid sharp depreciation in the rupee, the Reserve Bank on Wednesday announced more actions focused on authorised dealers (ADs). On a review of evolving market conditions, it has been further decided that authorised dealers shall not offer non-deliverable derivative contracts involving INR to resident or non-resident users, RBI stated. Authorised Dealers may, however, continue to offer deliverable foreign exchange derivative contracts to users to meet their hedging requirements provided that the user does not undertake offsetting non-deliverable derivative positions. Moreover, authorised dealers shall not permit a user to rebook any foreign exchange derivative contract involving INR, whether deliverable or non-deliverable, which is cancelled after the date of issuance of these instructions. Authorised Dealers shall also not undertake any foreign exchange derivative contract involving INR with their related parties. These instructions shall be applicable with immediate effect, until further review, the central bank further noted.