Spurred by sustained heavy foreign funds inflow, export proceeds and expatriate remittances, the rupee surged by yet another 17 paise to hit a new 38-month closing peak of Rs 45.39/40 per dollar on Friday, helped partly by a relatively weak dollar against global currencies.
Breaching the crucial Rs 45.50-dollar psychological barrier in early trade, stop-loss dollar sales, drove the rupee through the next resistance level of Rs 45.40, before settling at Rs 45.39/40, dealers said.
The rupee opened distinctly firm at Rs 45.53/56 per dollar from Wednesday's finish of Rs 45.56/57, aided by bunched up dollar supplies.
The forex market was closed on Thursday on account of Gandhi Jayanti.
In the volatile trade at the interbank foreign exchange market, the rupee's bull-run against the greenback continued unabated and the Indian unit soared to a new 38-month high, driven-up by persistent strong trade and capital inflows.
The smooth redemption of State Bank of India's $5.5 billion Resurgent India Bonds strengthened the rupee considerably in the last two trading sessions.
The rupee spurted by a whopping 27 paise on Wednesday and by yet another sharp 17 paise on Friday, after banks that had gone long on the dollar in anticipation of RIB redemption pressures, were forced to unwind long positions, helping the rupee's soar to new peaks, a forex dealer said.
Gaining 260 paise (5.4%) in the current calendar year, the rupee remains all set to strengthen further.