Rupee falls
Mumbai: The rupee fell against the dollar on Tuesday on the back of dollar buying particularly by oil companies. The rupee opened at 45.07/09 and touched an intra-day low of 45.28. It closed the day at 45.18, down from 45.12 on Monday. Dealers said the sharp rise in global crude prices led oil companies to purchase dollars in the market.

Bonds: Bond prices rose by 50 paise after interest rates were left untouched by the Reserve Bank of India (RBI) in its annual monetary policy for 2006-07.

Call rates: The call rate traded between 5.5 and 5.6 per cent (5.5).

Repo auction: In the one-day reverse repo auction, under LAF, the RBI received and accepted 19 bids amounting to Rs 9,180 crore in the first auction and 46 bids for Rs 46,790 crore in the second auction. There were no repo bids.

CBLO: The CBLO market saw 382 trades, aggregating to Rs 25,100.55 crore in the rate range of 4-5 per cent.
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RBI holds interest rates steady
Mumbai: In its annual policy statement for 2006-07, the RBI has kept its key interest rates - reverse repo, repo and cash reserve ratio - unchanged. The apex bank has also called for a slowdown in lending to sensitive sectors such as real estate and capital markets.

The bank has projected a lower credit growth of 20 per cent for the current year against 30 per cent in the last two years. It has also increased the risk weight on bank exposures to commercial real estate and capital market to 150 per cent from 125 per cent. Banks' exposure to venture capital funds will also form part of its capital market exposure, the RBI said. Thus, banks now have to set apart more capital in their books as cover to maintain their existing level of lending to these sectors. The RBI had increased the risk weightage for these sectors from 100 to 125 per cent in July 2005.

The central bank also increased banks' provisioning for standard advances from 0.4 per cent to 1 per cent for personal loans, capital market exposures, residential housing of more than Rs 20 lakh and commercial real estate loans.

In a move to help banks raise more deposits, the RBI has increased the ceiling in interest rates for NRE deposits for one to three years maturity to 100 basis points above Libor or Swap rates.

The central bank's annual policy indicates a possible rise in interest rates, in the event of an upturn in inflation due to pass-through of international oil prices.

The reaction of bankers across the country was that interest rates were headed upwards.
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ONGC to begin banking with ICICI Bank too
New Delhi: Oil and Natural Gas Corporation will start banking with ICICI Bank also. Till now State Bank of India was the sole banker for ONGC. On April 12 this year, the Corporation's board approved the decision to go in for parallel banking arrangement, so as to obtain the benefits of competitive customer service from the top two banks.
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