The rupee rose 19 paise to 67.76 against the dollar at the Interbank Foreign Exchange on Wednesday on increased selling of the US currency by exporters and banks.
Dealers said weakness of the dollar against other currencies overseas gave the rupee more muscle.
Furthermore, a higher opening in the domestic equity market ensured the uptrend picked up momentum, they added.
The domestic unit ended steady at 67.95 a dollar on Tuesdday following fag-end dollar demand from banks and importers in view of uncertainty in the currency market.
Meanwhile, the benchmark BSE Sensex rallied 149.33 points, or 0.56%, to 26,673.88 in early session on Wednesday.