This Article is From Apr 22, 2014

NSE ready to extend currency trading hours; Sebi nod awaited


The National Stock Exchange (NSE) on Tuesday said it is ready to extend trading hours for currency traders and is awaiting a nod from market regulator Securities and Exchange Board of India (Sebi).

"We are geared up to change currency trading timings as and when the SEBI allows us to do," NSE managing director and chief executive Chitra Ramkrishna told reporters on the sidelines of the bourse-organised Futures Tech Summit.

If the proposal gets regulatory nod, the currency futures market would be open from 9 a.m. to 7.30 p.m. as against the current timing time of 9 a.m. to 5 p.m.

Sebi chief U K Sinha had recently said there were plans to increase trading hours for currency futures which would allow domestic market participants to adjust and alter their positions in line with movements in foreign currencies in global markets.

The move would help contain sharp volatility in the onshore currency market, as most of the trading volume takes place in offshore markets like Singapore, over which domestic regulators have no control. The non-deliverable forwards market controls more than 80 per cent of the currency futures market.

"Timings of currency markets can now be enhanced from 5 pm to 7:30 pm. So, we are moving in a direction where the rupee derivatives market can help corporates, for example, hedge on a continuous basis," Mr Sinha had said at an investors' conference recently in Mumbai.

At present, currency futures are traded on platforms offered by exchanges like the NSE, Bombay Stock Exchange (BSE), MCX-SX, and United Stock Exchange (USE).

In 2013 and before that in 2012, in consultation with the Reserve Bank of India (RBI), Sebi had placed restrictions on currency derivatives, because of a volatile rupee.

However, some time ago, the regulator came out with a set of new guidelines, restoring margin requirements.

Ms Ramkrishna also said that she did not envisage any consolidation in the exchange space and said that competition is healthy for the market.