24x7 Forex market ops: Some NDF volume to move onshore, say experts

The cause for concern for the RBI in this regard is that it has no control over the NDF market, whereas, the onshore market is under direct supervision of the regulator

The move to allow Indian banks to offer derivatives quotes 24/7 is likely to divert some of the volume from the offshore markets to onshore ones, but it would still be a long way to go before the offshore non-deliverable forwards (NDF) markets are challenged seriously, say experts.

The reason for such a move is that the NDF market, being operated from locations such as Singapore, London, Dubai and New York, has garnered more volume than the Indian market in rupee. According to a survey in London in October 2018, the daily average turnover in the NDF market was $23