The Indian rupee ended higher for a second straight session on Wednesday amid possible dollar inflows and recovery of the Chinese yuan, traders and analysts said.

The rupee closed at 82.66 versus the U.S. dollar compared with 82.80 in the previous session and 82.83 at open. The domestic currency rose 0.17%, its best one-day gain since May 10.

Some corporate dollar inflows and those related to MSCI index rebalancing, which is happening towards the end of the month, lifted the rupee, said Dilip Parmar, research analyst at HDFC Securities.

A recovery in the yuan after a downside also supported the domestic currency, Parmar said.

Besides, exporters are selling as the USD/INR hit a strong resistance around 82.85, analysts said.

There was some dollar selling seen from major foreign banks, a trader with a private bank said.

The offshore Chinese yuan was at 7.05 to the dollar, having dropped to below 7.08 earlier in the session.

Meanwhile, investors awaited updates on the U.S. debt ceiling talks. Negotiations between representatives of U.S. President Joe Biden and congressional Republicans failed on Tuesday, even as the deadline to raise the borrowing limit ticked closer.

The dollar index stood firm near 103.52 and awaited minutes of the May Fed meeting, due during U.S. trading hours. It would provide more clues on the central bank's interest rate trajectory.

Stronger-than-expected U.S. economic data and hawkish comments from Fed officials have pushed up the odds of a rate hike in June to nearly 30%.

The odds had fallen to 10% last week after Fed Chair Jerome Powell's comments were seen dovish relative to expectations. (Reporting by Nallur Sethuraman in Mumbai; Editing by Sohini Goswami)