Exclusive: RBI asks Refinitiv to explain outage of forex trade platform on November 10

The Indian rupee fell to a new record low against the US dollar on November 10.

The Reserve Bank of India (RBI) has asked financial markets data and infrastructure provider Refinitiv to explain the outage foreign exchange market traders experienced on November 10, sources have told Moneycontrol.

The central bank wants to understand if the outage was caused by a system failure or human error, market sources said, among other issues.

"At around noon, there was an outage on the Refinitiv electronic trading platform. This led to traders being unable to log-in and orders dried up, leading to heightened uncertainty," a person in the know of the development said on condition of anonymity.

According to news agency Reuters, which supplies news to Refinitiv's financial terminal, the "outage of the interbank order matching system" lasted about 10 minutes and led to spreads on the rupee-dollar widening.

The uncertainty in the market resulted in the rupee hitting a new all-time low of 83.48 against the US dollar on November 10 despite likely intervention by the RBI to contain the exchange rate volatility. It closed the day at 83.34.

While the RBI does not target a particular level of the rupee's exchange rate, its publically stated stance is that it will intervene in the market to reduce undue volatility.

As per market sources, the central bank has asked Refinitiv whether Standard Operating Procedures related to business continuity were followed and if a root-cause analysis — a study into the reasons that caused the problem in the first place — is being undertaken to understand if the issue was caused by a system failure or human error.

Refinitiv India Transaction Services Pvt Ltd is one of five entities, other than banks, authorised by the RBI to operate an electronic trading platform, or ETP, for transactions in the spot foreign exchange market. It is a part of the London Stock Exchange Group.