The Indian rupee ended flat on Wednesday, as gains in shares amid hopes for more economic reforms from the Narendra Modi government were offset by caution ahead of a long weekend.
The rupee rose around 0.27 percent for the week against the dollar.
Recent measures by the government, including deregulation of diesel prices and plans to open up the coal industry to private players, have raised expectations for a bigger reform push.
Traders hope such reforms could help attract more foreign inflows into bonds and stocks. Indian markets will remain closed on Thursday and Friday for local holidays. "I feel 60.85-61.00 remains an important support as RBI starts buying at those levels.
I feel the inflows will continue and over the weeks we might see inflows improving since the government has started implementing a few policies," said Paresh Nayar, head of foreign exchange and fixed income trading at First Rand Bank.
The partially convertible rupee closed at 61.31/32 per dollar, unchanged from its Tuesday close.
Indian shares rose on Wednesday for a fourth straight session, tracking stronger global markets and closing at their highest in nearly a month as automakers surged on hopes of better sales in the festive season.
Traders broadly expect the rupee to hold in a 60.80 to 61.80 range next week with global factors continuing to remain key in the absence of any major domestic triggers.
In the offshore non-deliverable forwards, the one-month contract was at 61.42/47, while the three-month contract was at 62.00/10.
Factors to watch
* Euro falls on report some banks fail ECB stress test
* Won leads Asia FX gains on solid stocks, ECB hopes
* Asian shares shine on U.S. tech results, ECB hopes
* Foreign institutional investor flows
* For data on currency futures
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