Based on the recommendations of the working group chaired by Radha Shyam Ratho, Reserve Bank of India has extended trading hours for call money market, market repo and Tri-Party Repo, it said in a press release.
Call money market hours will be extended by two hours and will be operating from 9:00 am to 7:00 pm, up from the current closing time of 5:00 pm. This will come into force from July 1.
This extension aims to provide market participants with greater flexibility and improve liquidity management in the overnight money market, RBI said.
Trading hours for the market repo and Tri-Party Repo (TREP) segments will be extended to 4:00 pm, up from the current closing time of 2:30 pm. This change is expected to facilitate better price discovery and allow participants to manage their short-term funding needs more efficiently during the extended hours.
The RBI has decided to keep the trading hours for government securities, foreign exchange, and interest rate derivatives market unchanged for the time being.
The working group was tasked with conducting a comprehensive review of trading and settlement timings to enhance market development, improve price discovery, and optimise liquidity management.
Historically, RBI has maintained relatively conservative trading hours for the call money and repo markets, typically closing by late afternoon or early evening.
These timings, while adequate in the past, have increasingly been seen as restrictive given the evolving needs of market participants and the growing complexity of liquidity management.
RBI also said that it is still considering other recommendations from the working group and will announce further decisions on the same in due course.
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