Bankers affirm that the recent volatility in India’s currency derivatives market won’t impact the exchange rate of the Indian rupee. The turbulence, triggered by traders unwinding positions to comply with a central bank regulation, particularly in options, persisted as brokers urged clients to unwind positions or prove underlying forex exposure. However, bankers emphasize that the size of the option position being unwound must be significant to affect spot prices. The central bank’s rule, effective Friday, mandates that exchange-traded rupee derivative transactions can only be used for hedging, prompting brokers to take proactive measures.
Bankers Assure Rupee’s Exchange Rate Unaffected by Recent Volatility
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