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Mumbai, May 28 (PTI) The rupee today shot up by a whopping 94 paise, or nearly 2 per cent, against the US dollar on the back of smart rally in equities and the US currency weakening in overseas markets. Dealers said exporters frantically sold dollar after its recent smart rise which boosted the rupee sentiment. The dollar was weak against its major rivals abroad, they added. The euro rebounded as investors preferred to unwind their short positions ahead of the month-end, dealers pointed out. The recent extreme risk aversion stemming from eurozone debt concerns eased helping the euro gain strength. A smart recovery in equities might brought back capital inflows to the domestic market, according to dealers. The rupee today resumed remarkably higher at 46.71/72 after a day''s break yesterday at the Interbank Foreign Exchange (Forex) market. It moved in a range of 46.78 to 46.30 before settling at 46.35/36, a steep rise of 1.99 per cent over its last close. Rally in local equities too helped the rupee to surge for the second straight session. The Indian benchmark Sensex closed up by 196.66 points, or 1.18 per cent, after gaining 643.92 points or 4.02 per cent in last two trading sessions. Brokerage firm SMC Global Vice-President Rajesh Jain said, "The stock market went up for the third consecutive day today and that helped the rupee gain strength. Usually when the market is on an upside, traders usually hedge their position and go on speculative buying in rupee." The benchmark six-month forward dollar premium payable in October recovered to 50-52 paise from 48-1/2-50-1/2 paise on Wednesday and far-forward maturing in April also improved to 91-93 paise from 88-1/2-90-1/2 paise previously. The Reserve Bank fixed the dollar reference rate at Rs 46.54 and for the euro at Rs 57.38. The rupee improved further against the pound and the yen while recovered against the euro. The rupee hardened against the pound to close at Rs 67.51/53 per pound from Wednesday''s close of Rs 68.08/10 while bounced back against the euro to Rs 57.44/46 per euro from Rs 58.26/28 previously. It strengthened against the yen to Rs 50.82/85 per 100 yen from its last close of Rs 52.38/40 previously.
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