Rupee scales two-year peak of 63.7 vs dollar

The rupee strengthened sharply on Wednesday to close at a two-year high of 63.7 to a dollar, highest since July 22, 2015.

Generally, when there is a rate cut, the local currency should depreciate. On Wednesday, though, it rose even as the Reserve Bank of India (RBI) cut its policy rate by 25 basis points (bps) and stock indices fell.

Around 12:40 pm, say currency dealers, a large Indian exporter, possibly a conglomerate, sold a huge amount of dollars in the market. That led the rupee to fall below 64 a dollar, after having opened at 64.12. After the RBI deputy governor