The risk-on approach pushed exporters and banks increasingly away from the dollar.
The greenback ran out of luck overseas too, snapping its winning streak, as it fell against major peers.
The rupee uptrend got a leg-up from a positive opening in the local stock market, according to traders.
Yesterday, the domestic unit ended marginally up by 2 paise at 65.36 against the American currency in a highly fluctuating trade.
The benchmark BSE Sensex today rose further by 110.72 points, or 0.34 per cent, to 31,957.61.