Continuing strong recovery, the rupee re-entered the psychologically important 65 zone against the US dollar to its highest level in three weeks, amid heavy selling of the American currency by foreign banks, as worries over US interest rates hike abated.
A relief rally, after the US Federal Reserve decided yesterday to keep interest rates at historic lows, pre-dominantly led to the positive mood across the emerging financials and currency markets.
Trading at 65.72 per dollar, the rupee has not seen this seen since August 27.
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Buoyant domestic stock market and dollar’s weakness against other currencies overseas also weighed on sentiment.
The US central bank >kept interest rates unchanged at 0-0.25 per cent citing concerns over recent global economic developments against the backdrop of China induced growth slowdown jitters.
On the global front, the dollar is trading substantially weak against other major currencies.
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US dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down by 0.30 per cent at 94.30.
The rupee resumed stronger at 66.15 as against > Wednesday’s closing of 66.46 at the Interbank Foreign Exchange (Forex) market.