Rising for the fifth day in a row, the rupee on Monday appreciated 22 paise against the US dollar to end at an over seven-month high level of 60.85 on heavy capital inflows into equities that surged to a fresh record.
Sustained dollar selling by exporters and some banks also aided the rupee sentiment, limiting the impact of the US dollar's gain in overseas markets.
Foreign Institutional Investors bought shares worth Rs 1,253.65 crore on Monday as per provisional stock exchange data.
The rupee commenced lower at 61.26 a dollar from last weekend's close of 61.07 at the Interbank Foreign Exchange (Forex) market. With equities facing a choppy initial session, the rupee also touched a low of 61.34.
It later bounced back to a high of 60.79, before ending at 60.85 -level not seen since August 6, 2013 when it had closed at 60.77. On Monday, the rupee rose 22 paise, or 0.36 per cent. In five days, it rose 119 paise or 1.92 per cent.
The benchmark S&P BSE Sensex on Monday extended its gains for the fifth session in a row and closed up 15.04 points at a new record close. Intra-day, it breached 22,000 level for the first time.
The dollar index was up 0.10 per cent against a basket of six major global rivals.
Pramit Brahmbhatt, CEO, Alpari Financial Services, (India) said: "Today in the morning session, rupee traded weak but as the day progressed rupee appreciated and closed on a positive note. Rupee strengthened to a seven-month high backed by the heavy foreign inflows into both equities and debt. Expect the rupee to trade range bound within 60.50 to 61.50."
