The rupee on Tuesday erased initial gains to closed flat at 54.85 against the US dollar amid RBI keeping key rates unchanged in the mid-quarter policy review. While the rupee snapped a four-session downslide, it could not cement intra-day gains as RBI kept short-term lending (repo) and CRR unchanged. At the Forex market, the rupee commenced firm at 54.70, which was also the dayís high, from overnight close of 54.85. However, it later fell back to a low of 55.05 in late morning session after the RBI left the key rates stable and hinted easing of rates in the next meeting scheduled for January 29. However, emergence of dollar selling at the fag end and rise in equities helped the rupee to bounce back to settle at its Mondayís closing level of 54.85. The dollar index was down by 0.15% against a basket of six major currencies.