The rupee continued to rule firm for the fifth day today to close at a fresh 3-month high of 66.26, rising 11 paise on persistent selling of US dollars by banks and exporters in view of sustained foreign capital inflows.
Weakness of dollar in the overseas market also boosted the rupee value against the dollar, a forex dealer said.
Foreign funds (FPP and FIIs) continued their buying spree as they bought shares worth Rs 1,442.47 crore yesterday as per the provisional data of stock exchanges.
The rupee resumed slightly higher at 66.35 as against yesterday's closing level of 66.37 at the Interbank Foreign Exchange (Forex) market here today and hovered in a range of 66.17 and 66.45 per dollar before closing at a fresh 3-month high 66.27, showing a gain of 11 paise or 0.17 per cent.
It has gained 45 paise or 0.67 per cent in 5 days.
The rupee had last ended at 66.14 per dollar on January 1, 2016.
Meanwhile, the dollar index was down by 0.28 per cent against a basket of six currencies in the late afternoon trade.
Overseas, the US dollar was trading lower against its major rivals in late Asian trade as dovish comments from Federal Reserve Chair Janet Yellen continued to resonate, dampening demand for the currency.
The Indian benchmark Sensex ended marginally higher by 3.28 points or 0.01 per cent to 25,341.86.
Meanwhile, FIIs continued to mop up Indian stocks and
bought shares worth a net Rs 355.54 crore yesterday, as per the provisional data.
On the global front, the dollar continued to hover at two-month highs against other major currencies on growing expectations for an imminent rate hike next month even as investors eyed the release of key macro data later in the day.
Brent crude prices fell on rising output from the West Asia and ahead of an OPEC meeting later this week.
In forward market, premium for dollar fell further sharply due to sustained receivings from exporters.
The benchmark 6-month premium for October moved down to 168.5-169.5 paise from 170-172 paise and far forward April 2017 contract also edged down to 361.75-362.75 paise compared to 364.5-366.5 paise yesterday.
In the meantime, Indian markets snapped their five-day stellar rally and succumbed to fresh profit-taking.
The flagship index Sensex fell by 58 points to finish at 26,667.96 while the broader Nifty lost over 18 points to settle at 8,160.10.
