After two days of listless trade, the Indian rupee on Friday rebounded 15 paise to close at two-week high of 61.77 against the Greenback following dollar selling by exporters and some banks amid signs of fund inflows.
Dollar selling was so strong that even a weak trend in local equities and a firm dollar overseas could not stem the rupee's rise, forex dealers said.
At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced higher at 61.80 a dollar from previous close of 61.92. It was trapped in a narrow range of 61.75 --almost two-week intra-day low-- and 61.90 before concluding at 61.77, logging a rise of 15 paise or 0.24%.
This was its strongest close since 61.76 on November 21.
In the previous two sessions, the rupee had softened by four paise or 0.06%.
The local currency also took cues from government's 5% stake sale in SAIL, for an estimated Rs 1,700 crore, generating a robust demand among investors with the offer getting subscribed more than two times on Friday.
The Indian stock benchmark S&P BSE Sensex, however, fell back by 104.72 points, or 0.37%.
FPIs/FIIs had injected USD 103.13 million on Thursday as per Sebi data.
The dollar index, an indicator of other six major global rivals, was up by 0.27%.
In the forward market, premia remained weak on sustained receipts by exporters.
The benchmark six-month premium payable in May declined further to 217.5-219.5 paise from 220-222 paise previously.
Forward contracts maturing in November 2015 also dropped to 428-430 paise from 432.5-434.5 paise.
The Reserve Bank of India fixed the reference rate for dollar at 61.8535 and for the Euro at 76.5313.
The rupee recovered slightly against the pound to 96.92 from 97.086 on Thursday, while improved further to 51.26 per 100 Japanese yen from 51.61.
It, however, turned a tad negative to end at 76.27 per euro from Thursday's close of 76.25.