Bolstering its upward trend for the second session, the rupee on Thursday appreciated another nine paise to end at an over three-week high of 64.45 amid unabated rise in domestic equities. The domestic currency had logged its previous best of 64.43 against the US dollar on June 19. Heavy unwinding of dollars by currency speculators and banks in the midst of abundant capital inflows predominantly supported the upmove
Retail inflation has raised hopes that the Reserve Bank of India may cut interest rates by 25 basis points at its next policy review on August 1-2.
According to forex dealers, heavy dollar selling by banks and exporters and dollar's weakness against other currencies overseas supported the rupee momentum.
The domestic unit opened higher by 15 paise at 64.39 at the Interbank Foreign Exchange market today. It hovered in a range of 64.50 and 64.39 before quoting at 64.45, up 9 paise.
Yesterday, the rupee had recovered 5 paise to close at 64.54 against the US currency.
Meanwhile, the 30-share BSE index Sensex settled at a new peak of 32,037.38, up 232.56 points, or 0.73 per cent.
The Australian and New Zealand dollars were the biggest beneficiaries of a slide in their US equivalent on Thursday after testimony from US Federal Reserve chair Janet Yellen bolstered a global stock market rally that dates back 7 years.
Against a basket of currencies that measures its broader strength, the US dollar fell back to its lowest since last October in Asian trading, undoing all of a recovery last week driven by generally higher global bond yields.