Rupee gains 17 paise to end at 3-month high vs dollar

A weak dollar in overseas market in view of the Federal Reserve's cautious stance on interest rate strengthened the rupee value

Extending its gains for fourth trading day, the rupee on Wednesday surged by 17 paise to close at three-month high of 66.37 per dollar on sustained selling of dollars by banks and exporters amid firm stock markets.

A weak dollar in overseas market in view of the Federal Reserve's cautious stance on interest rate strengthened the rupee value, a forex dealer said.

The rupee resumed higher at 66.48 per dollar as against last close of 66.54 at the Interbank Foreign Exchange (Forex) market here and firmed up further to 66.3175 in day trade.

It closed at three-month high of 66.37 per dollar, showing a gain of 17 paise or 0.26 per cent. The rupee had last ended at 66.14 per dollar on January 1, 2016.

The local currency has gained by 34 paise or 0.51 per cent in four days to Wednesday.

Meanwhile, the dollar index was down by 0.23 per cent against basket of six currencies in the late afternoon trade.

The dollar weakened against the yen and the euro in late afternoon trade today after Federal Reserve Chairperson Janet Yellen's cautious stance on interest rate hikes.

Speaking before the Economic Club of New York, Fed chief Yellen said global economic and financial uncertainty justified a slower path of interest-rate increases, remarks that suggested little appetite to raise rates next month.

"Following dovish stance that propelled by Yellen, rupee opened on a positive note and continued to trade positive. Positive cues from domestic equity market added fuel in rupee rally," Pramit Brahmbhatt of Veracity Financial Services said.