The rupee continued to rule firm against the American currency for the second consecutive day by surging 6 paise to close at 62.30 on persistent selling of dollars by banks and exporters.
A sustained foreign capital inflows into the equity market also boosted the domestic currency's value against the dollar, a forex dealer said.
The rupee opened today at 62.36 at the Interbank Foreign Exchange (Forex) market and hovered in a range of 62.28 and 62.40 per dollar before concluding at 62.30, showing a gain of six paise, or 0.10 per cent.
The domestic currency has gained by 21 paise, or 0.34 per cent, in the last two days.
In the New York market, the dollar tumbled against its rivals yesterday after a spate of weak data suggested that the US economy has yet to move past the slowdown in growth seen in the first quarter.
The dollar index, a gauge of six major global rivals, was up by 0.46 per cent today. Pramit Brahmbhatt, Veracity group CEO, said, "The rupee traded range bound to slightly strong against the dollar and appreciated by almost 6 paise to close at 62.30, taking cues from the weak dollar index which is heading towards to post its third daily fall in a row and also the continuous dollar selling by exporters helped the rupee to trade strong."
Though the weak local equities which closed in red, capped the rupee gain. The trading range for the Spot USD/INR pair is expected to be within 61.80 to 62.80.
Meanwhile, the benchmark 30-share Sensex dropped by 133.65 points, or 0.46 per cent. In the forward market, premia ended mixed due to uneven demand and supply transactions.
The benchmark six-month premium payable in September eased to 216-218 paise from 216-1/2 to 218-1/2 paise yesterday while forward contracts maturing in March 2016 moved up to 437-1/2-439-1/2 paise from 434-1/2 to 436-1/2 paise.
The Reserve Bank of India fixed the reference rate for dollar at 62.3685 and for the euro at 66.5597.
The rupee dropped further against the pound sterling to 93.01 from 92.01 yesterday and also moved down against the euro to 66.84 per euro from 66.06 previously.
It also fell against the Japanese yen to 52.36 per 100 yens from 52.18 previously.
