Brief Overview:
RBI recently announced their intention to finalise the draft directions on Bond Forwards which were released in 2023.
JC takeaway:
Insurance entities will be the primary beneficiaries of these directions once finalised. This will help them hedge their exposures as regards interest rate risks on G-Secs thereby adding to existing list of products to hedge. This will further help in price discovery of other derivatives with G-Secs as underlying.
The final set of directions are awaited.
For further details, please see:
Reserve Bank of India – Press Releases
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