RPT-India rupee edges up, traders eye policy review

(Repeats to additional subscribers) (Updates to close)

By Sahar Ahmed

MUMBAI, April 22 (Reuters) - The Indian rupee ended slightly stronger on Tuesday, helped by capital inflows, but its rise was limited by suspected central bank intervention and dollar buying by oil firms, dealers said.

The partially convertible rupee INR=IN ended at 39.955/965 per dollar from Monday's close of 39.975/98.

"Everyone is waiting for the monetary policy next week," said the chief trader at a foreign bank.

"There was some supply which got picked up by the central bank."

The Reserve Bank of India releases a review of monetary policy on April 29. Last week, the central bank announced an increase in banks' reserve requirements, and dealers are waiting to see if further measures are unveiled next week to try to help cool inflation from three-year highs above 7 percent.

Following the increase in reserve requirements, the rupee hit a high of 39.83 on Monday, its highest since March 31, but traders said the central bank stepped in to buy dollars.

The central bank has intervened this month to stem the rupee's rise, belying analysts' expectations it would allow the currency to appreciate to counter inflation.

Oil CLc1, India's biggest import, rose to a record high above $118 a barrel on Tuesday. High oil prices raise the risk of widening the trade deficit and putting downward pressure on the rupee. (Editing by John Mair)