Can a Central Bank Devalue its Currency on Purpose?

My politically opinionated father asked me worriedly, “Why has the INR depreciated since the current government took over?” I first said, “Go back a little farther, and you will see that the INR has been depreciating, irrespective of who was running the government.” But is that a bad thing? The words “depreciating” or “falling” INR […]

Content, Zerodha Varsity
24 Apr 2024

Underlining the Underlying Exposure

The RBI requires anyone trading in currency derivatives to have an underlying exposure to forex. It seems many market participants were not aware of this. So, the RBI recently reinforced this requirement through a recent circular. The deadline to ensure that users participating in currency derivatives have an underlying exposure was set at 05 April […]

Content, Zerodha Varsity
05 Apr 2024

RBI: Putting the Ex in Forex

Through a recent circular, the RBI pulled the plug on speculative forex derivative trades in India. Until now, any speculator could trade currency derivatives on a stock exchange. This is because disclosing an underlying exposure was not required up to a certain limit. Therefore, currency derivative volumes on the NSE were booming. The prices and […]

Founder, StockViz
03 Apr 2024

Margin required for trading currency going up – July 9, 2013

Dear Traders, Margin required for trading currency futures and options on NSE and MCX-SX would be increased because of the recent volatility in the currency derivative contracts. The increase in margins is presently applicable only for the USD/INR contracts and is applicable from July 11, 2013. To ensure that this increase in margin doesn’t affect our […]

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09 Jul 2013