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The rupee was trading strong at 64.11 as the dollar weakened globally after the US Federal Reserve kept policy rates unchanged.
According to dealers, increased selling of the American currency by exporters and banks also supported the upmove.
The domestic unit opened strong by 18 paise at 64.19 at the Interbank Foreign Exchange market today. It hovered in a range of 64.20 and 64.06 before quoting at 64.11, up 26 paise at 4.35 pm local time.
Yesterday, the rupee had ended marginally higher at 64.37 in a cautious trade on a day domestic equity markets scripted history.
Meanwhile, the 30-share BSE index Sensex ended up by 0.84 point or 0.00 per cent at 32,383.30 as investors turned cautious ahead of the expiry of futures and options contracts at the end of the session.
The dollar weakened against world currencies overseas after the Federal Reserve policy statement highlighted a tepid inflation outlook fuelling speculation that it is unlikely to hike rates in September. Hardening of interest rates in the US leads to flight of foreign capital from emerging markets due to better yields.
The dollar was 0.2 per cent lower against the basket of currencies used to measure its broader strength, and it fell 0.5 per cent against the Australian dollar - one of a series of commodities-linked currencies to profit from this week's bounce in oil and metals prices.
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