Completing three straight sessions of appreciation, the Indian rupee today shot up by 62 paise to close at a two-and-a-half month high of 49.30/31 against the US dollar on the back of sustained capital inflows amid late recovery in local equity markets.
A weak dollar against some Asian currencies, dollar selling by multinational banks as well as expectations of increased foreign funds inflow in share markets after a strong rally also boosted rupee sentiment.
In active trade at the Interbank Foreign Exchange (Forex) market, the domestic unit resumed strong at 49.60/62 a dollar from its previous close of 49.92/94.
It moved in a range of 49.70 and 49.28 before concluding at 49.30/31 per dollar, the level not seen since February 16, 2009, when it was closed at 48.82/83.
In the three sessions, the rupee has gained by 121 paise or 2.40 per cent.
According to a forex dealer, heavy foreign funds inflows in local equity markets mainly supported the rupee.
However, a negative turnaround in local equity markets might cap the rally in the rupee, an analyst said.
The Indian benchmark Sensex recovered its early losses, and ended nearly flat at 12,131.08.