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The Reserve Bank on Monday permitted resident entities to hedge their exposure to price risk of gold on exchanges in the International Financial Services Centre (IFSC).
Resident entities in India are currently not permitted to hedge their exposure to price risk of gold in overseas markets.
“On a review, it has been decided to permit eligible entities to hedge their exposure to price risk of gold on exchanges in the IFSC recognised by the International Financial Services Centres Authority (IFSCA),” the RBI said in a circular.
An announcement in this regard was made by Reserve Bank Governor Shaktikanta Das while unveiling the bi-monthly monetary policy last week.
Hedging refers to the activity of undertaking a derivative transaction to reduce an identifiable and measurable risk.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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