The rupee strengthened on Tuesday but its advance was blocked by the central bank as the Indian unit appeared on course to breach a decade high on steady investment flows, dealers said. The partially convertible rupee ended at 39.265/275 per dollar, stronger than the previous close of 39.29/31 but off an intraday peak of 39.22.
The rupee stalled before a test of its November peak of 39.16, which was its highest level in almost 10 years. "The RBI clearly does not want any rapid appreciation, and the market is happy to keep selling to them," said the senior dealer at a private bank, referring to the Reserve Bank of India.