Continuing its upward march for the fourth consecutive day, the rupee on Wednesday surged by another 31 paise to end at a nearly seven-week high of 67.54 on persistent selling of dollars by banks and exporters in view of fresh foreign capital inflows.
A sustained rise in equity market also boosted the rupee sentiment. The sensex shot up further by 463.63 points or 1.95% on Wednesday.
The rupee resumed higher at 67.74 from Tuesday’s closing level of 67.85 per dollar at the Interbank Foreign Exchange and shot up further to 67.53 before ending at a 7-week high of 67.54, showing a gain of 31 paise or 0.46%.
The rupee had last ended at 67.29 per dollar on January 14, 2016.
It has gained by 118 paise or 1.72% in four trading days.
The rupee hovered in a range of 67.53 and 67.77 per dollar during the day.
Meanwhile, the dollar index was up by 0.10% against a basket of six currencies in the late afternoon trade.
The dollar was largely unchanged against the yen in Asian trade on Wednesday, weighed by profit-taking despite an improvement in the market’s mood.
Pramit Brahmbhatt of Veracity Financial Services said, “The rupee opened on a positive note with a decent gain at 67.74/USD and since then we saw rupee strengthening taking cues from the domestic equity market, which saw a cheerful rally on the back of a rate cut hope in immediate monetary policy by the RBI”.
It was for the second consecutive day Nifty rose by 147 points in on Wednesday’s trading session. The rupee closed with a huge gain of 31 paise at 67.54/USD.
Trading range for the spot USD/INR pair is expected to be within 67.20 to 67.80.
In forward market, premium for dollar recovered slightly on fresh paying pressure from corporates.
The benchmark six-month premium for August moved up to 223-225 paise from 222-224 paise on Tuesday and far forward February contract also recovered to 426.5-428.5 paise from 425-427 paise on Wednesday.
The RBI fixed the reference rate for the dollar at 67.70 and euro at 73.53.
In cross-currency trades, the rupee recouped against the pound sterling to finish at 94.52 from 94.89 on Tuesday and also firmed up further against the euro to 73.34 from 73.67 on Wednesday.
The domestic unit also advanced further against the yen to finish at 59.04 per 100 yen from 59.95