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RBI reduces market hours for bond and forex trading

In an unprecedented move, the Reserve Bank of India (RBI) today reduced the trading hours for both the currency and bond markets to four hours owing to the operational and logistic risks arising out of the nation-wide lockdown imposed to contain the spread of Covid-19. 

Accordingly, bond and forex markets will operate from  10 AM to 2 PM as against earlier timing of 9 AM to 5 PM. The new timings will come into force from April 7 (Tuesday) and continue up to April 17 (Friday), both days inclusive. 

In a press statement, the RBI said, “The unprecedented situation created by the COVID-19 outbreak has necessitated lockdowns, social distancing, restrictions on movement of people and non-essential activities, work from home arrangements and business continuity plans. The resultant dislocations have adversely impacted the functioning of financial markets.”

The Central bank also said that staff and IT resources (of market participants) have been severely affected, posing operational and logistic risks and that the thinning out of activity is impacting market liquidity and increasing volatility of financial prices.

“In order to minimise these risks and to ensure that market participants maintain adequate checks and supervisory controls while optimising thin resources and ensuring safety of personnel, it has been decided to revise trading hours for various markets,” the release added.

Accordingly, markets for Call/notice/term money, Commercial paper (CP) and Certificates of Deposit (COD), Government Securities, Foreign Currency Trades including Forex Derivatives will function in the revised term. 

“All regular banking services for customers, including RTGS, NEFT, e-kuber and other retail payments systems will continue to be available as per extant timings,” RBI added. 

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