(Updates to close) 
    MUMBAI, Dec 7 (Reuters) - The Indian rupee climbed on Friday 
buoyed by a single sale of dollars by a private equity firm in a 
deal estimated at around $500 million, though suspected central 
bank intervention limited gains, dealers said. 
    The partially convertible rupee <INR=IN> ended at 39.395/405 
per dollar, heading back towards a near-decade high of 39.16 hit 
last month, and moving up from the previous finish of 39.485/495. 
    "It's really the big deal done by a British bank that moved 
the market today, though RBI was there to see that the rupee did 
not get ahead of itself," said a dealer with a foreign bank, 
referring to the Reserve Bank of India. 
    Overseas funds have been a key driver of the rupee's more 
than 12 percent rise this year, helping it to be among Asia's 
best-performing currencies against the dollar this year. 
    Foreign funds have stepped up their purchases of Indian 
shares this month after remaining tepid in November, when they 
pulled out about $1.1 billion.  
    Sentiment for the rupee was boosted as India's main share 
index <.BSESN> rose 0.9 percent, led by banking and software 
services, with investor expectations of a U.S. rate cut 
underpinning the rise. 
The U.S. Federal Reserve, which meets on Dec. 11, is widely 
expected to lower the key federal funds rate by 25 basis points 
to 4.25 percent. It has cut rates twice since mid-September, 
widening the interest differential with India's rates. 
    Still, the Reserve Bank of India is expected to continue to 
intervene against the local unit in a bid to temper its ascent. 
    According to the latest data, the central bank bought about 
$52 billion through intervention in the first nine months of the 
year, and is also seen as having played an active role in the 
rupee market in October and November too. 
 (Reporting by C.J. Kurrien, Editing by Mark Williams) 
 ((Reuters Messaging: [email protected], 
91-22-6636 9037)) 
Keywords: MARKETS INDIA RUPEE