The cross currency futures launched on the first day of February 2010 by MCX-SX and NSE saw modest, but encouraging, volumes on the first trading day, with both exchanges clocking a combined turnover of about Rs 4,000 crore, accounting for roughly 20 per cent of the total volume in value terms.
What is striking is the wide bid-offer spread in cross currencies of three months tenor. While for the US dollar futures the spread is in the range of 4 paise, for cross currencies it is as high as 58, 69 and 99 paise respectively for Euro, GBP and Yen.
This indicates that the buy side is dominated by hedgers, mostly exporters and there is lukewarm response from the sell side. Going by the first day, the market needs active participation,
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