The rupee continued its downward journey for the third straight session and ended lower by another seven paise to 49.94/95 against the greenback, due to month-end demand for the US currency amid a firm dollar overseas.
In fairly active trade at the Interbank Foreign Exchange (Forex) market, the local currency resumed remarkably higher at 49.72/75 a dollar from the previous close of 49.87/88.
Forex dealers attributed the smart initial recovery in the rupee value to rally in global equity markets. The Indian benchmark Sensex was up by nearly 173 points in mid-afternoon trade though pared early gains and ended higher by over 80 points or 0.91 per cent.
Most of the Asian indices also finished the day in the green while European markets also displayed a firm trend this morning due to overnight rise on Wall Street.
Yesterday's announcement of another Rs 30,000-crore rescue package by the government to support the sagging economy mainly helped the recovery in local bourses, which support the rupee, forex dealers said.
However, sudden dollar buying by oil refiners as well as importers to meet their month-end requirements mainly weighed on the rupee and it fell back to settle the day at 49.94/95 a dollar.
