Rupee moves up marginally
Mumbai: The rupee moved up marginally against the dollar on Tuesday on good dollar supplies. The currency opened at 44.13/14 and dropped to close the day at 44.24/25, against 44.27 on Friday.

In forwards, the 6-month closed at 3.15 per cent (3.60) and the 12-month ended at 2.69 per cent (2.93).

Bonds: Bond prices rallied by almost 55 paise (yields went down by around nine basis points) on easier liquidity. The total traded volumes on NDS-order matching system also improved to Rs6,290 crore (Rs1,260 crore).

G-secs: The 7.59 per cent 10-year 2016 paper opened at Rs99.90 (7.60 per cent YTM) and closed at Rs100.35 (7.53 per cent YTM) against the previous close of Rs99.80 (7.62 per cent YTM).

The 8.07 per cent 11-year 2017 paper opened at Rs103.20 (7.61 per cent YTM) and closed at Rs103.77 (7.53 per cent YTM) against Friday's Rs103.14 (7.62 per cent YTM).

Call rates: Call rates eased to 8-8.50 per cent on easier liquidity. Call rates had touched 11 per cent on Saturday and touched a nine-year high of 19 per cent on Friday.

Reverse repo: In the first one-day reverse-repo auction under LAF, the RBI did not receive any bid and in the first one-day repo auction, the RBI received and accepted 38 bids for Rs17, 040 crore.

In the second one-day reverse-repo auction, the RBI accepted and received 21 bid for Rs11, 365 crore and in the second one-day repo auction, the RBI received and accepted three bids for Rs905 crore.

The CBLO market saw 353 trades aggregating to Rs16,313 crore in the 5 per cent-15.25 per cent range.
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Pre-budget: Banks likely to ask for tax exemption on interest income
New Delhi: The banking industry may ask for restoration of tax exemption on interest income, increase in ceiling for tax deduction at source and relaxation in the lock-in period for savings under Section 80 C, in the forthcoming Budget.

Mobilisation of deposits for banks is becoming a problem due to availability of other investment avenues that give higher returns; banks want restoration of the earlier provision for tax exemption on interest income of up to Rs15,000 per annum.

Under the present rules, banks are required to deduct tax at source in case interest income is more than Rs5,000 per annum but say the interest income limit for TDS should be raised at least to over Rs10,000 per annum.

Bankers also want relaxation in the mandatory five-year lock-in-period to get tax benefit under Section 80 C for fixed deposits up to Rs1 lakh, to make it attractive for investors.

In a pre-Budget presentation to the finance ministry, industry body CII has also asked the government to encourage personal savings by doubling the limit under Section 80 C from Rs1 lakh to Rs2 lakh to make adequate funds available for the infrastructure sector.
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UTI Bank to raise Rs100 crore
Mumbai: UTI Bank is planning to raise Rs100 crore through Upper Tier II unsecured redeemable subordinated debentures, with an option to retain over-subscription.

The debenture carries a coupon rate of 9.50 per cent per annum. The face value and issue price is at Rs 10 lakh per debenture. The issue has been rated "LAA" by ICRA and "AA (ind)" by independent rating agency Fitch. The issue opened on December 30 and will close on January 20.
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