The rupee rose to its highest in more than two weeks on Monday as firmer Asian currencies and gains in the domestic share market heightened expectations of more capital inflows into Indian assets. At 10:35 a.m., the partially convertible rupee traded at 49.61/62 per dollar, stronger than Wednesday's close of 50.04/05. It climbed as much as 1 percent from the previous close in early deals to an intraday high of 49.55, its strongest since April 16, before easing back in mid-morning trade. The currency market was shut on Thursday and Friday for holidays. "The rupee has risen in line with other Asian currencies and there are bunched up dollar inflows due to the holidays. The stocks are also higher, which is helping," a senior dealer with a foreign bank said. "It is likely to trade in a 49.50 to 49.85 band today," he added. Traders cited a strong psychological support level around 49.50 due to a build-up of long dollar/rupee positions and a heavy order pipeline of importer orders. The BSE Sensex shares rose nearly 5 percent early, tracking gains across Asia. The benchmark stock index climbed 17.5 percent in April, its biggest monthly gain in 10 years. Foreigners moved more than $1.4 billion into Indian shares during April 1-27, helping the rupee rise 5.2 percent from its record low of 52.20 hit in early March. Last year record outflows of over $13 billion had pushed the rupee down by a fifth. The dollar index, a gauge of the dollar's performance against six major currencies, was down 0.3 percent as investor confidence about the global economy encouraged buying of commodities and riskier currencies. Traders said the rupee was unlikely to rise sharply beyond 49 until the results of the national elections are announced in mid-May, which would then set the tone for the Indian currency. One-month offshore non-deliverable forward contracts were quoted at 49.67/77, weaker than the onshore spot rate.

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