The rupee was buoyed immensely by foreign investor flows on Friday and strengthened to below 60 level at 59.90 for the first time since July 2013 against the dollar in late afternoon trade on sustained foreign fund flows.
The rupee has surprised the markets this week by inching towards an eight-month high against the dollar. On Friday, it resumed higher at 60.18 to the dollar as against the last closing level of 60.31 at the Interbank Foreign Exchange (forex) market and firmed up further to break the crucial 60 level to trade at 59.90 in late afternoon trade, a level last seen in July 2013.
Dealers said sustained selling of the American currency by banks and exporters and the ongoing bull-run on the domestic equity markets also buoyed sentiments.
India Forex Advisors' Founder & CEO Abhishek Goenka said, “Rupee was seen posting strong gains against the US dollar and was seen moving above 7 month high today. It has breached the psychological level of 60.00 against the US dollar today. FII’s have been wholeheartedly supporting the rupee since past few weeks. Technically, USD/INR pair has a strong support of 59.50 (61.8 per cent retracement of the rally from May-August 2013).”