Mumbai: With China's currency devaluation sending forex and stock markets into a tizzy, RBI's Technical Advisory Committee on financial markets met on Thursday and reviewed the recent developments in G-Secs and foreign exchange markets.
The meeting, chaired by RBI Deputy Governor H R Khan, reviewed the recent developments in money, government securities and foreign exchange markets.
It also discussed various issues relating to the financial benchmarks, disclosure and reporting requirements for commercial papers (CP) and relaxations in the documentation-related requirements for hedging in the forex market, RBI said in a statement.
Indian markets joined the global sell-off sparked by China growth concerns as the benchmark Sensex today saw this year's worst single-day fall of 555 points to end at a 19-month low of 24,851.83, pulling down the rupee to more than a three-week low of 66.93.
The 40th meeting of TAC "also reviewed the recommendations of the Working Group on Interest Rate Options (Chairperson: P.G. Apte) and Implementation Group on encouraging retail participation in government securities (Chairperson: Rekha Warriar)."
The panel approved the constitution of a Standing Group under the TAC to suggest measures for compliance with global standards in the OTC derivative market, it said.
The Committee also deliberated on measures for development of corporate bond and the term money market, it said.
Meanwhile, China today lowered the yuan's central rate against the US dollar by 0.51 per cent to 6.5646, the lowest since March 2011. A lower currency would make Chinese exports cheaper and more competitive in the global markets.
Stock trading in China was suspended for the second time this week today, as the benchmark Shanghai Composite Index slumped 7 per cent.
Besides Khan, senior officials from RBI, representatives from the Finance Ministry, the Securities Exchange Board of India (SEBI), the Insurance Regulatory & Development Authority (IRDA) were present.
Members from industry bodies, banks, exchanges, clearing corporation, Fixed Income Money Market and Derivatives Association of India (FIMMDA) and other market entities participated in the meeting.