Understanding Interest Rate Derivatives Understanding Interest Rate Derivatives Interest rate derivatives are becoming increasingly popular in the Indian financial markets as businesses, financial institutions, and investors seek ways to hedge against interest rate fluctuations. DSIJ Intelligence / Tuesday, February 4, 2025 / Article rating: 5.0 These financial instruments derive their value from underlying interest rates, like the Reserve Bank of India’s (RBI) benchmark rates, government bond yields, or indices such as the Mumbai Interbank Offered Rate (MIBOR).