Rupee down 27 paise to Rs 61.79 against dollar in early trade

Extending its Monday's losses, the rupee lost 27 paise to Rs 61.79 against the US dollar in early trade on Tuesday on the Interbank Foreign Exchange due to appreciation of the Greenback against other overseas currencies.

Dealers attributed the fall in rupee to gains made by US dollar against the euro and other overseas currencies ahead of US jobs data and a lower opening in the domestic equity market.

Increased demand for the dollar from importers and banks also put pressure on the local currency.

The rupee weakened by 25 paise to close at Rs 61.52 against the dollar in Monday's trade on persistent demand from importers and banks as the US currency strengthened overseas.

Meanwhile, the BSE benchmark Sensex fell 31.74 points, or 0.15 per cent, to 20,862.15 in early trade on Tuesday.

Reverse mortgage scheme: Tax break for senior citizens on income from house

With an aim to make the reverse mortgage facility more attractive for senior citizens, the government has decided to give tax break on installment earned by pledging his residential property.

Now it has been decided that annuity would be tax exempt, National Housing Bank Chairman and Managing Director R V Verma said.

The scheme is operated by National Housing Board and housing finance companies, banks and insurance companies.

Besides income tax benefit, he said, the installment income or annuity is expected to increase at least three times to the benefit of retired person.

According to a conservative estimate, the reverse mortgage loan market is upwards of Rs 20,000 crore.

Banks have so far sanctioned Rs 1,800 crore and disbursed Rs 800 crore under reverse mortgage loan since it's launch in 2008, he said.

The revised scheme now enables a person above the age of 60 years to avail of monthly payments from insurance company as annuity till the life time against the mortgage of his/her house while remaining the owner and occupying the house.

Earlier, the period of reverse mortgage loan was 20 years from the date of signing the agreement by the reverse mortgagor and the approved lending institution. But, now period has been extended to "the residual life time of the borrower," said a notification by the Central Board of Direct Taxes (CBDT).

As per the amendment, Life Insurance Corporation of India (LIC) and other insurer registered with the Insurance Regulatory and Development Authority (IRDA) have included as annuity sourcing institutions.

As per the scheme, on the borrower's death or on the borrower leaving the house property permanently, the loan is repaid along with accumulated interest, through sale of the house property. The borrower or heir can also repay the loan with accumulated interest and have the mortgage released without resorting to sale of the property.

CAD will reduce below $70 billion: Rangarajan

Stating that there has been improvement in the trade account, Chairman of the Economic Advisory Council to Prime Minister C Rangarajan on Tuesday said the Current Account Deficit (CAD) will go down well below $70 billion.

Pointing out that in August and September, India's exports showed a double digit growth rate, Rangarajan said at an event here that India's trade deficit in the first half of this year was $80 billion as compared to $92 billion in the previous year.
If the present trend in exports and imports continue, the overall CAD will reduce even lower than $70 billion.

Noting that the Indian rupee over the last few weeks had remained stable at around 61-62 against the US dollar, he said the rupee was well corrected for inflation differential.

Referring to the USA's indication of tapering on May 22 and the resultant fall in capital flows, he said this affected capital inflows not only to India but to all the emerging economies including Brazil as investments were moved to the USA.

However, now, there has been a change and investments flows have turned positive, he said.

Gold prices down in futures trade on weak global cues, profit-booking

Gold prices moved down by 0.11 per cent to Rs 29,496 per 10 gm in futures trade on Tuesday as participants indulged in trimming their positions, tracking a weak trend in the global market.

At the Multi Commodity Exchange, gold for delivery in February next year eased by Rs 33, or 0.11 per cent, to Rs 29,496 per 10 gm in business turnover of one lot.

Likewise, the metal for delivery in December shed Rs 11, or 0.04 per cent, to Rs 29,745 per 10 gm in 138 lots.

Market analysts said apart from a weak trend in the overseas markets, profit-booking by speculators also weighed on gold prices at futures trade.

Globally, gold traded $3.30, or 0.25 per cent, lower at $1,313.30 an ounce in Singapore on Tuesday.

BSE Sensex trades flat during pre-noon trade

The BSE benchmark index was trading flat and was down over 30 points in Tuesday's trade on selling pressure. At 12.17 pm, Sensex was down 32.51 points at 20861.38. Similarly, Nifty was down 9.35 points at 6195.60 during the same time.

Good buying was observed in IT, metal and public sector undertakings (PSU) sectors; while selling pressure was seen in fast moving consumer goods (FMCG) sector.

The 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE), which opened at 20,863.15 points, was trading at 20,893.70 points in the early morning session, down 0.19 points or 0.00 percent from previous day's close at 20,893.89 points.

The Sensex touched a high of 20,948.91 points and a low of 20,849.78 points during trade so far.

The S&P BSE IT index gained 20,849.78 points, metal index inched up by 46.92 points and PSU index moved up by 39.65 points; however, FMCG index dipped by 12.80 points.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) was also trading down by 0.30 points or 0.00 percent at 6,204.65 points.