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RBI expands currency futures to Euro, GBP, JPY-INR pairs

Current · Source: Reserve Bank of India · RBI/2009-10/290 · issued 19 Jan 2010 · ~1 min read

Quick answerRBI now permits trading in Euro-INR, GBP-INR, and JPY-INR currency futures on recognized stock exchanges, effective January 19, 2010, alongside existing USD-INR contracts. This allows direct hedging of currency risk in these pairs.

The rule, in the simplest words

Banks can now trade futures (a promise to buy or sell a currency at a fixed price later) for Euro, British Pound, and Japanese Yen against the Indian Rupee, not just US Dollar.
Each contract has a fixed size: Euro 1000, British Pound 1000, and Japanese Yen 100,000.
The settlement price (the final price used to close the contract) is based on the RBI's official exchange rate for that day.
This rule started on January 19, 2010.

How it plays out — a real example

A forex & trade-finance officer in Indore has a customer who imports machinery from Japan and needs to pay in Japanese Yen. Before this rule, the officer could only help hedge (protect against price changes) using US Dollar futures, which was complicated. Now, she can directly offer the customer a JPY-INR futures contract, making it simpler and cheaper to lock in the exchange rate for the payment.

What changed

Previously, only USD-INR currency futures were allowed for residents. RBI has now added Euro-INR, GBP-INR, and JPY-INR contracts. Contract sizes are set at Euro 1000, GBP 1000, and JPY 100,000 respectively, with settlement prices based on RBI reference rates or press release exchange rates.

What it means for you

Banks and their customers can now hedge exposure to Euro, GBP, and JPY directly on exchanges, reducing reliance on over-the-counter products. This deepens the currency derivatives market and offers more flexibility for importers, exporters, and investors dealing in these currencies.

What you must do

Update internal systems and product documentation to include the new currency pairs and contract specifications.
Inform customers and constituents about the availability of Euro-INR, GBP-INR, and JPY-INR futures for hedging.
Ensure compliance with the amended Currency Futures Directions, including settlement price rules for each pair.

Who it affects

AD Category-I banks, Resident investors and hedgers in currency futures

❓ Common questions

Regulatory timeline

Stated effective date effective January 19, 2010
Decoded by BankPulse 2026-06-19 07:44 IST

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

Which new currency pairs are now allowed for futures trading?

Euro-INR, GBP-INR, and JPY-INR, in addition to the existing USD-INR contracts.

What are the contract sizes for these new futures?

Euro 1000 for Euro-INR, GBP 1000 for GBP-INR, and JPY 100,000 for JPY-INR contracts.

How is the settlement price determined for these contracts?

For USD-INR and Euro-INR, it's the RBI Reference Rate. For GBP-INR and JPY-INR, it's the exchange rate published in RBI's press release on the last trading day.

📜 Read the original circular — full text as issued by RBI

RBI/2009-10/290 

 A.P. (DIR Series) Circular No. 27 

  January 19, 2010 

 To

 All Authorised Dealer Category - I Banks

 Madam / Sir,

 Guidelines on trading of Currency Futures 

 in Recognized Stock Exchanges 

 Attention of Authorized Dealers Category – I (AD Category – I) banks is invited to A.P.(DIR Series) Circular No. 05 dated August 06, 2008, permitting persons resident in India to participate in the currency futures market in India, subject to the directions contained in Currency Futures (Reserve Bank) Directions,  2008 [ Notification No. FED.1/ DG (SG)-2008 dated August 6, 2008].

 2. Currently, persons resident in India are permitted only to trade in US Dollar (USD) - Indian Rupee (INR) currency futures contracts in recognized stock exchanges. In order to facilitate direct hedging of currency risk in other currency pairs as well, it has been decided, as announced in the Second Quarter Review of Monetary Policy 2009-10 (Para 117), to permit the recognized stock exchanges to offer currency futures contracts in the currency pairs of Euro-INR, Japanese Yen (JPY)-INR and Pound Sterling (GBP)-INR, in addition to the USD-INR contracts, with immediate effect.

 3.  Accordingly, the Notification No.FED. 2 / ED (HRK)-2009 dated January 19,  2010 viz. Currency Futures (Reserve Bank) (Amendment) Directions, 2010, amending the Directions notified vide Notification No.FED.1/DG(SG)-2008 dated August 6, 2008 has been issued. A copy of the Notification is annexed.

 4. AD Category-I banks may bring the contents of this circular to the notice of their constituents and customers, concerned.

 5. This circular has been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and is without prejudice to permissions / approvals, if any, required under any other law.

 Yours faithfully,

 Salim Gangadharan

 Chief General Manager-in-charge

 Annex 

 [A.P.(DIR Series) Circular No.27 

 dated January 19, 2010] 

 Currency Futures (Reserve Bank) (Amendment) Directions, 2010 

 Notification No. FED. 2/ ED (HRK)-2010 dated January 19, 2010 

 The Reserve Bank of India having considered necessary in the public interest and having regard to the need for regulating the financial system of the country to its advantage, in exercise of its powers conferred by section 45W of the Reserve Bank of India Act, 1934 and of all the powers enabling it in this behalf, hereby makes the following amendments to the Currency Futures (Reserve Bank) Directions, 2008 which were notified vide Notification No. FED.1/ DG (SG)-2008 dated August 6, 2008 and published in Part III, Section 4 of the Gazette of India (Weekly) dated October 11, 2008. 

 1. Short title and commencement of the directions 

 These Directions may be called the Currency Futures (Reserve Bank) (Amendment) Directions, 2010 and they shall come into force with effect from January 19, 2010.

 2. Amendment of the directions 

 In paragraph 4 of the Currency Futures (Reserve Bank) Directions, 2008, 

 (i)  in clause (a), after the words “Only USD-INR”, the comma and words, “, Euro-INR, Pound Sterling (GBP)-INR  and Japanese Yen (JPY)-INR ” shall be inserted.   

 (ii)  in clause (b),  after the words “USD 1000”, the words, “ for USD-INR contracts, Euro 1000 for Euro-INR contracts, GBP 1000 for GBP-INR contracts and JPY 100,000 for JPY-INR contracts." shall be inserted. 

 (iii)  for clause (e) , the following clause shall be substituted, namely :-

 "e. The settlement price for USD-INR and Euro-INR contracts shall be the Reserve Bank’s Reference Rates and for GBP-INR and JPY-INR contracts shall be the exchange rates published by the Reserve Bank in its press release on the last trading day.” 

 (H. R. Khan) 

 Executive Director

 Foot Note:-

 The principal regulations were published in the Official Gazette No. 41 dated October 11 - October 17, 2008 in Part III - Section 4 [Miscellaneous Notifications including Notifications, Orders, Advertisements and Notices issued by Statutory Bodies] vide No. FED.1 / DG (SG) – 2008.

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2009-10/290 · issued 19 Jan 2010. The plain-English explanation above is BankPulse’s own independent summary.

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Who does what — compliance checklist

⚙️ Operations

Ensure compliance with the amended Currency Futures Directions, including settlement price rules for each pair.

💻 IT / Systems

Update internal systems and product documentation to include the new currency pairs and contract specifications.

📜 Compliance

Inform customers and constituents about the availability of Euro-INR, GBP-INR, and JPY-INR futures for hedging.

Grouped from the action items above — a single circular may involve more than one team.

Worked example & action-note template

Example: if you are an IT/Systems lead at a bank this circular applies to (AD Category-I banks, Resident investors and hedgers in currency futures), your first concrete step on “RBI expands currency futures to Euro, GBP, JPY-INR pairs” is: “Update internal systems and product documentation to include the new currency pairs and contract specifications.” (RBI issued this 19 Jan 2010).

Circular: RBI/2009-10/290 -- RBI expands currency futures to Euro, GBP, JPY-INR pairs
Issued: 19 Jan 2010
Action required: Update internal systems and product documentation to include the new currency pairs and contract specifications.
Action required: Inform customers and constituents about the availability of Euro-INR, GBP-INR, and JPY-INR futures for hedging.
Action required: Ensure compliance with the amended Currency Futures Directions, including settlement price rules for each pair.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________

Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

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BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly).
Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=5468&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.