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RBI to allow resident entities to hedge gold price risk at Financial Services Centers

The Reserve Bank of India governor said that resident institutions would now be allowed to hedge gold price risk. (File)


Reserve Bank of India Governor Shaktikanta Das today said entities resident in India will now be allowed to hedge the risk of gold prices at the International Financial Services Centre.

At present, entities resident in India are not permitted to hedge their exposure to gold price risk in overseas markets.

Shaktikanta Das after making the announcement said, “With a view to providing greater flexibility to these entities to efficiently hedge the price risk of their gold exposure, it has been decided that resident entities will be required to list their gold assets on recognized exchanges in the IFSC.” be allowed to hedge the gold price risk.” Bi-monthly Policy Review.

He said that the central bank will issue detailed instructions in this regard separately.

Meanwhile, Shaktikanta Das also announced the extension of the enhanced HTM (held to maturity) limit of 23 per cent till March 31, 2024, and asked banks to sell securities acquired between September 1, 2020 and March 31, 2024. allowed to join. Enhanced HTM limit.

The Reserve Bank had increased the limit under the HTM category in respect of Statutory Liquidity Ratio (SLR) eligible securities acquired on or after September 1, 2020, from 19.5 per cent to 23 per cent of net demand and time liabilities (NDTL). March 31, 2023.

This relaxation of increase in HTM limit was provided up to March 31, 2023, he said, adding that the HTM limit will now be restored from 23 per cent to 19.5 per cent in a phased manner from the quarter ending June 30, 2024.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

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