The Indian rupee posted its best close in a month for a second day on Friday as a watchful central bank loosened its grip slightly towards the close, letting the local currency ride up a little on strong capital inflows. The rupee ended at 43.5600/5650 per dollar, a gain of 0.07 percent from Thursday's 43.5850/5950 close and the best finish since 43.50/51 on February 7. The local currency also notched up its best one-week gain in five weeks, appreciating 0.45 percent over five straight days.
"State-run banks were buying for most of the day, both for customers and the central bank, and only after they let go did it end at a high of 43.5650," a trader at a state-run bank said. The central bank has reined in the rupee since it scaled a five-year high of 43.30 in early February in order to keep local exports competitive and growing nearly as fast as the imports consumed by the liberalising and rapidly expanding economy.