The Indian rupee rose to its highest in almost 12 weeks today as global oil prices eased further.
The rupee strengthened past the psychological 71-to-the-dollar mark, climbing to as much as 70.9175, the highest since Sept. 3 and compared to its previous close of 71.46 on Tuesday. It was trading at 70.93 to the dollar at 1033 GMT.
The foreign exchange market was closed yesterday for a local holiday. India imports more than two-third of its oil requirement and a fall in crude prices eases dollar demand from importers.
The Reserve Bank of India was not seen intervening in the spot forex market to contain the sharp rise in the rupee, two dealers said. "Traders are unwinding long dollar positions," said a foreign bank dealer.
Oil prices fell after U.S. crude inventories swelled to their highest since December, stoking concerns about a global glut but OPEC talk of an output reduction limited the losses.
Benchmark Brent was down 67 cents at $62.82 a barrel by 0904 GMT, after dropping as much as $1 earlier in the session.