In line with stock markets, the rupee ended higher by 6 paise at 60.07 against the dollar on fresh selling of the American currency by banks and exporters in view of strong capital inflows.
The rupee resumed higher at 59.98 per dollar as against the last closing level of 60.13 at the Interbank Foreign Exchange (Forex) Market.
After moving in a narrow range, it settled at 60.07, a gain of 6 paise from its previous close.
Pramit Brahmbhatt, Veracity Group CEO, said: "Today, the rupee appreciated as corporates were seen selling dollars. Exporters too were seen selling dollars at higher levels, but the dollar demand from oil importers capped the rupee gain. Dollar index is also trading weak which helped Rupee futures to appreciate almost quarter per cent."
The BSE benchmark Sensex today ended 20 points higher at 22,344.04 after paring initial gains in volatile trade.
Meanwhile, Finance Minister P Chidambaram in New Delhi said the rupee at a level of 60 to a dollar is an "accurate" valuation of the domestic currency. He said the value of the rupee is determined by the market.
"The correct measure is the REER (real effective exchange rate). As long as the REER is around 100, that reflects more or less the correct value of a currency.
"We think that rupee at about 60 to a dollar, given the REER, is more or less an accurate reflection of the true value of the currency," he said.
In London, the euro rose against the dollar even as investors awaited European Central Bank President Mario Draghi's comments on persistently low inflation and the potential for more easing.
