India enforces stiffer rules on forex derivatives

This is to curb rupee weakness.

According to BBVA, with the Indian rupee testing fresh historical lows against the USD (60.2 at present), the Reserve Bank of India and the Securities Exchange Board of India (SEBI) have tightened rules on currency derivatives trading to curb speculation. 

BBVA said that measures include prohibiting dealers from carrying out proprietary trading in FX futures/exchange traded options, tighter limits on gross open positions, and doubling of the margin requirements on USDINR currency derivatives.

"We expect the measures to provide a modest near term support to the rupee, however, given elevated foreign currency repayments by Indian companies (USD 8 bn over the rest of 2013)," BBVA said.