Foreign exchange : Foreign exchange Markets where money in one currency is exchanged for another
Evolution of foreign exchange market in India : Evolution of foreign exchange market in India Indian FX market is originated in 1978
It allow the banks to undertake intra-day trading in FX
Exchange rate of the rupee is officially determined by RBI
In 1994, unification of the exchange rate of rupee taken place based on the demand and supply in the foreign exchange
Slide 3: Appoint expert group(Sodhani Committee)on FX in design of FX market in India
Bank has been accorded significant initiative and freedom to operate in the market
Market profile : Market profile Indian FX market is a transaction based market
FX market is made up of authorized dealers, some intermediaries and end users
The average turnover of the FX market increased in 2003-04, when compared to that of PY
Disclosure and Transparency Initiatives : Disclosure and Transparency Initiatives RBI has been transparent in data relating to FX market
The movement in FX reserves of the RBI are published in Weekly Statistical Supplement
RBI make public half yearly reports on management of FX reserves with the concurrence of govt. of India
Institutional development : Institutional development Vast size of the daily FX trading, combined with the global interdependencies of the foreign market involves high risk
RBI establish Clearing Corporation of India Limited(CCIL) to mitigate risks in the Indian financial markets
CCIL daily settles over 3500 deals covering an average gross volume of around $3.5 billion
CCIL : CCIL CCIL’s intermediation providers its member benefits such as improved efficiency, lower operational cost etc..
CCIL has improved operational efficiency with zero failure rate
CCIL launched a Forex Trading Platform to facilitate US Dollar/Rupee deals by banks of india
FEDAI : FEDAI Foreign Exchange Dealers Association of india(FEDAI) as a self-regulatory organisation formed by authorized dealers
The aim of the FEDAI is to enhance its catalytic role in the market development
Talks ahead : Talks ahead RBI will adopt approach characterised by gradualism in respect of future liberlisation of FX market