Malaysia's Bank Negara eases hedging in crude palm oil market
Bank Negara Malaysia has issued a supplementary notice which provides additional hedging flexibility for participants in the crude palm oil market. The notice allows a non-bank, non-resident market participant that is registered with BNM to enter into forward contracts with a licensed onshore bank or an appointed overseas office up to the net open position of its ringgit-denominated crude palm oil futures or options traded on Bursa Malaysia Derivatives for the purpose of managing its ringgit exposure arising from the contracts. The notice also allows a non-bank, non-resident market participant to unwind the excess forward contracts with the same licensed onshore bank or appointed overseas office in the event that the notional value of such forward contracts exceed the net open position of the underlying futures or options contracts.
