Finance · Foreign Exchange Guidelines

Consider the following statements regarding technical forex regulations and market practices in India: Statement 1: FEDAI is a self-regulatory body incorporated in 1958 that formulates rules governing the day-to-day business conduct of authorized dealers. Statement 2: Direct quotes are those where the foreign currency is fixed and the home currency is variable. Statement 3: A Nostro account is 'our account with you' (domestic bank's account abroad), while a Loro account is 'their account with you'. Statement 4: For option forward contracts, the bank prices the option period based on the rate most disadvantageous to the customer to protect itself. Statement 5: A currency is at a forward discount if the forward price is lower than the spot price, often due to higher domestic interest rates. Statement 6: REER is adjusted for inflation and used by the RBI to assess competitiveness. Statement 7: Deferrals of Spot and Tom transactions due to unexpected holidays in centers like New York can lead to interest costs known as 'overnight swap' adjustments. Which of the following evaluations of these technical statements is entirely accurate?