NCDEX to launch intl gold, silver contracts

Written by Commodities Bureau | Mumbai | Updated: Dec 28 2008, 03:23am hrs
The National Commodity and Derivatives Exchange Ltd (NCDEX) has decided to introduce two international bullion futures contracts, for gold international and silver international respectively from December 29. These will be transparent international price hedging contracts in rupees for importers and bullion traders. Gold international contracts expiring in January and March 2009 would be available for trading on December 29, 2008. Silver international contracts expiring in February, April 2009 and June 2009 would be also available for trading on December 29, an exchange official said.

These contracts are available for trading during the entire year and will be settled by the compulsory delivery mechanism. On account of persistent market demand and keeping in mind the fact that India has very high imports of bullion, NCDEX has now introduced 2 new bullion contracts, a top NCDEX official said.

The final settlement price for gold contracts will be calculated on the last trading day based on international spot prices and at RBI reference rates. The international spot price will be added by as one US dollar bank premium and then will be multiplied by 32.15 to calculate the equivalent of the per kg price from the value per ounce. The limit of the daily price fluctuation will be (+ or -) 4% for gold and (+ or -) 6% for silver.