According to a Reserve Bank of India (RBI) Working Paper, the optimal hedge ratio for the External Commercial Borrowings (ECBs) raised by firms in India is estimated at 63 per cent for the periods of high volatility in the foreign exchange (forex/FX) market. An optimal hedge ratio is a ratio that implies the percentage of total asset or liability exposure that an entity ought to hedge against exchange rate fluctuations.
Buy Prime Test Series for all Banking, SSC, Insurance & other exams
According to the Paper, domestic economic activity and movements in the exchange rate of the Indian rupee are the two major factors influencing the ECBs issuance. Depreciation of the Indian rupee has an adverse impact on the issuance of ECBs in the short as well as long run.
In a significant political development, José Raúl Mulino has emerged victorious in Panama's presidential election,…
The 2024 Madrid Open, held in the Spanish capital from April 22 to May 5,…
Every year on the first Tuesday of May, we celebrate World Asthma Day. This year…
May 2024 is brimming with significance, hosting a myriad of observances, celebrations, and remembrances globally.…
India's cities are often known not just by their original names but also by unique…
On May 5th, the world unites to celebrate the Portuguese language, a linguistic treasure that…