The rupee snapped its 3-day losing streak to settle 14 paise higher at 74.44 (provisional) against the U.S. dollar on Wednesday, tracking positive regional peers, even as the domestic equity market settled with significant losses.
At the interbank foreign exchange market, the rupee opened lower at 74.70 a dollar, registering a decline of 12 paise from the last close. During the day, it pared losses and witnessed an intra-day high of 74.32.
The domestic unit finally settled at 74.44 (provisional) against the American currency, up 14 paise over its last close.
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On Tuesday, the rupee slumped by 33 paise to close at a two-week low of 74.58 against the U.S. dollar.
"The Indian rupee gained the most in a week following stronger regional currencies. Domestic bond markets saw a recovery on suspected intervention by the central bank, which helped in rupee recovery," said Dilip Parmar, Research Analyst, HDFC Securities.
Also, the relentless selling of dollars from corporates caused speculative unwinding of positions, Mr. Parmar said.
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"Spot USD/INR is expected to consolidate within the 74.25 to 74.80 band in the coming days," he added.
Meanwhile, the U.S. dollar index, which measures the greenback's strength against the basket of six currencies, fell 0.11 % to 95.62.
Brent crude futures, the global oil benchmark, jumped 0.94 % to $ 88.33 per barrel.
Foreign institutional investors remained net sellers in the capital market on Tuesday, as they offloaded shares worth Rs 1,254.95 crore, as per stock exchange data.
On the domestic equity market front, the BSE Sensex ended 656.04 points or 1.08 % lower at 60,098.82, while the broader NSE Nifty declined 174.65 points or 0.96 % to 17,938.40.