Leading stock exchange BSE Wednesday said it has received approvals to launch interest rates futures on overnight MIBOR (Mumbai Inter-Bank Offer Rate).
In this regard, the bourse has got clearance from the Sebi and the RBI, according to a release.
MIBOR is the interest rate at which banks borrow from one another for short term purposes. Financial Benchmarks India Pvt Ltd announces the overnight MIBOR on a daily basis and it is computed by the Clearing Corporation of India (CCIL).
"With the opportunity to introduce interest rates futures on overnight MIBOR, market participants will be able to forecast and manage interest rate risk on the BSE," the exchange's MD and CEO Ashishkumar Chauhan said.
MIBOR rate is based on trade-weighted interbank call money transactions on the Negotiated Dealing System call platform of CCIL between 9 am and 10 am.
"The reference rate is based on the actual traded rates as opposed to polled rates thus acting as an important tool that helps institutions manage interest rate risk," the release said.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)
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