Thumbs up on new forex control move

THE South African Reserve Bank's easing on regulations on currency controls will allow investors to better manage market volatility, Standard Bank said yesterday.

THE South African Reserve Bank's easing on regulations on currency controls will allow investors to better manage market volatility, Standard Bank said yesterday.

The central bank has relaxed administration on exchange controls for hedging on over-the-counter trades.

The move, including losing the requirement to provide documentation within 14 days to justify the need for foreign currency, applied to contracts of six months or less.

Standard Bank said the relaxation would assist in further developing the markets.

Investors would be able to surrender or cancel contracts traded before the expiry date and settle them immediately.

Previously cash flows resulting from early surrendering of a forward exchange contract could be settled on maturity of the instrument. - Reuters

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