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The rupee strengthened to near two-month high in morning trade due to dollar flows from custodian banks.
At 10:40 am, it was trading at Rs 61.34 compared with previous close of Rs 61.53 per dollar.
"If the rupee breaks the Rs 61.25 mark, I see it strengthening further during the day," said a currency dealer.
The rupee is also appreciating as economic sentiments are improving in India, said dealers.
