The Indian rupee crept up on Wednesday, after being stuck in a tight band for much of the day, as dollar sales by exporters more than offset purchases by oil firms. The partially convertible rupee ended at 39.995/40.005 per dollar and 0.04 percent stronger than Tuesday's close of 40.01/02. It was trapped in a narrow 39.98-40.05 band for the entire session.
"Today's been very, very lacklustre. Not too much activity," said the head of trading at a private bank. "We've seen oil companies buying quite a lot of dollars, but we've also seen exporter selling (dollars), and that's keeping it pretty much steady," he said.
The central bank, which in recent days has intervened in the currency market to stem the rupee's rise, remained on the sidelines on Wednesday, two traders said.
Annual inflation jumped to a three-year high of 7.0 percent, data released on Friday showed, prompting speculation the central bank may allow the rupee to appreciate against the dollar as a means of taming spiralling prices.