RBI Tightens Rupee Derivative and Cash Rules
The Reserve Bank of India has tightened rules on rupee non-deliverable derivative contracts and expanded a cash reserve requirement for banks. The measures aim to support the local currency amid steep oil prices and capital outflows.
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India's central bank tightened rules on rupee non-deliverable derivative contracts on Monday, limiting overseas clients to hedging use only. The Reserve Bank of India also widened a 20% cash reserve requirement to banks' own currency hedges. The actions follow a 6% decline in the rupee this year driven by steep Brent Crude Oil prices.
