Staging a good recovery, the rupee today ended at a fresh six-week high of 64.55 a dollar, gaining by 6 paise on fresh selling of the American currency and also well-supported by favourable macro indicators.
A spectacular record-breaking rally in local equities along with fresh dollar unwinding by exporters and some foreign banks largely aided the recovery momentum.
This is the highest closing for the home currency since September 20, when it had ended at 64.27 against the dollar.
Sluggish dollar sentiment overseas along with robust capital inflows also aided to the rupee rise.
Foreign portfolio investors (FPIs) were net buyers in the cash market and bought shares worth a net Rs 1,032.88 crore yesterday, as per provisional data from exchanges. At the Interbank Foreign Exchange (FOREX) market, the rupee resumed higher at 64.57 against Thursday's closing value of 64.61 on fresh bouts of dollar selling.
It later confined to a rather narrow trading range and swung between a high of 64.5250 and a low of 64.6350 due to uneven dollar demand and supply.
The home unit finally settled at 64.55, showing a gain of 6 paise, or 0.09 per cent.
For the week, the Indian unit appreciated by solid 50 paise against the greenback.
The RBI, meanwhile, fixed the reference rate for the dollar at 64.5764 and for the euro at 75.3348.
On the macro support, services sector activity in India expanded for the second consecutive month in October, driven up by rising new orders -- the fastest pace since June -- amid positive demand conditions, says a monthly survey.
Though forex market witnessed some volatile movements during the session in the face of risk event ahead of the US jobs data due later on Friday.
Global crude prices traded above the key psychological USD 60-mark a barrel thanks to increased compliance with OPEC production cut.
Meanwhile, Indian bourses charged to fresh record highs for the second-straight day powered by financial stocks and also driven by ongoing stellar earnings season amid highly buoyant global cues following the appointment of new US Federal Reserve chief.
The BSE benchmark Sensex shot up by 112 points to end at 33,685.56, while broader Nifty jumped 29 points at 10,452.50.
Globally, the dollar inched forward slightly against major trading rivals as investors wait for US jobs data to lift the currency out of its rut.
The US currency was weighed down by news that President Donald Trump appointed Jerome Powell as the new head of the Federal Reserve. Powell is likely to follow a similar dovish monetary policy stance as his predecessor Janet Yellen.
The dollar index, which measures the greenback's value against a basket of six major currencies, was down at 94.44 in early trade.
In cross-currency trades, the rupee rallied sharply against the pound sterling to end at 84.37 from 85.31 per pound and hardened against the Japanese yen to settle at 56.56 per 100 yens from 56.62 yesterday.
The rupee also firmed up against the euro to close at 75.14 from 75.27 earlier.
Elsewhere, pound sterling recovered sharply against the greenback on Friday after services activity report showed signs of economic revival.
Sterling had plunged sharply overnight after Bank of England raised interest rates for the first time in a decade by a quarter of a percentage point to 0.5 per cent and signalling the start of a gradual increase in borrowing costs.
In forward market today, the premium for dollar weakened further due to sustained receiving from exporters.
The benchmark six-month premium payable in April edged down to 137-139 paise from 139.50-140.50 paise and the far forward October 2018 contract also moved down to 276-278 paise from 279-281 yesterday.
On the International energy front, global crude prices turned buoyant after a brief slide, supported by OPEC-led supply cuts as well as by strong demand.
Brent futures, the international benchmark for oil prices, were at USD 60.86 per barrel in early Asian trade, up 24 cents, or 0.4 percent, from their last close. Brent has risen by 37 per cent since its low in 2017 reached last June.
US West Texas Intermediate (WTI) crude was at USD 54.83 a barrel, up 29 cents, or 0.5 per cent.
Disclaimer: No Business Standard Journalist was involved in creation of this content
