The rupee ended broadly steady on Friday with dollar demand from oil and utility companies offsetting expectations of increased foreign fund inflows into the country's rising stock market.
The rupee started on a strong note, drawing support from a weaker dollar overseas, trader said.
But it gave up most of its gains after data showed India's trade deficit for the first five months of the financial year to March 2005 expanded to nearly $10 billion from $6.6 billion a year earlier.
The rupee ended at 45.8750/8850 per dollar, off the morning's high of 45.7850 and barely changed from the previous close of 45.8750/8900. It eased to an intra-day low of 45.9300, before dollar liquidation by banks who had gone long saw it bounce back.
"There was a reasonable amount of commercial dollar demand which went through," said a trader at a private bank.
"Sentiment was also weighed down by the widening trade deficit. If crude oil prices remain firm, the rupee could dip from current levels."