Exchange Traded Currency Futures to be introduced in 3 months

New Delhi, June 3 (UNI) Securities and Exchange Board of India Chairman C B Bhave today said Exchange Traded Currency Futures will be in place in the next three months.

''The market is matured for the introduction of Exchange Traded Currency Futures,'' Mr Bhave told 87th Annual General Meeting (AGM) of ASSOCHAM.

Mr Bhave said Currency Futures are already operational in the OTC segment, therefore, there would be no problem in introduction of Exchange Traded Currency Futures as the OTC segment is far more difficult to operate.

Regarding a question relating to introduction of interest rate derivatives, Mr Bhave said RBI has put out a consultative paper in this regard. An expert committee under the aegis of RBI is looking at all the issues connected with operationalising interest rate derivatives.

He, however, declined to indicate a time frame for the introduction of interest rate derivatives.

On a question relating to efficacy and feasibility of merging National Stock Exchange (NSE) with Bombay Stock Exchange (BSE), Mr Bhave did not favour the idea.

''The existence of two exchanges ensure competition amomgst them and give a better deal to financial intermediaries. The merger of NSE and BSE is not in our interest and it is a good thing that the two exchanges co-exist,'' he said.

He didn't favour any further steps to promote foreign inflows into the stock markets, saying excess liquidity creates its own problems. At the moment, there was excess liquidity.

''Our key priority is to constantly balance the domestic and foreign flows,'' he said.

Mr Bhave was of the view that setting up of an International Finance Capital would be a step in the right direction. However, problems relating to physical infrastructure and human capital need to be tackled.

UNI SBA/GS SG DS1243