Rupee opens stronger at 40.57 against USD

Mumbai, May 23: The rupee today opened stronger at 40.57 as against the previous close of 40.57/58, as investors suspected Reserve Bank of India (RBI) intervention on rupee's gains.

In the early trade, the rupee posted an intraday high of 40.54 as capital inflows remained strong to sustain the domestic unit as the strongest Asian currency.

However, it slipped down later as investors suspected the central bank intervention on rupee's gains, while not much movements were seen in markets around noon, dealers said. Rupee is currently trading at 40.61 against USD.

''The fear of RBI intervention on rupee still persists in the investor circles and rupee may go down in the ensuing sessions,'' a dealer said.

The spot rupee had hit 40.51 on Monday, which is its highest since May 1998.

Rupee has gained over 9 per cent this year drawing support from unprecedent capital inflows.

The RBI has bought USD 2.3 billion in March, in a bid to stem the rupee's rise, dealers added.

UNI