Commodity market regulator Forward Markets Commission has sent out a directive to commodity exchanges to revise the price limit for rubber to 4 per cent with immediate effect. Until now the maximum daily price limit for rubber was 3 per cent, according to a National Multi-Commodity Exchange (NMCE) circular.
“Rise in the initial and maximum price limit for rubber will give traders an opportunity to trade comfortably and the price movement will be more volatile,” brokerage firm SMC Global’s commodity analyst Vandana Bharti said. The initial daily price limit also witnessed a revision and went up to 3 per cent from the earlier 2 per cent.
This revised daily price limit of 4 per cent would be applicable to all rubber contracts, including the running ones, with immediate effect, the circular said. The price limit would be calculated on the basis of previous day’s closing price, it added. Price limit is the maximum upside or downside movement of any particular commodity, whereby when it reaches that limit, trading stops.