Stamping its best single-day show this year, the rupee on Wednesday surged by 37 paise to breach the psychological 64-level against the US dollar and finally ended at a fresh two-year high of 63.70 after the RBI set the platform by lowering the repo rate by 0.25 per cent.
This is the best closing for the home currency since July 22, 2015, when it had ended at 63.58 against the US dollar.
The domestic currency on Wednesday rode on high optimism as the central bank after a 10-month pause decided to cut the benchmark interest rate by 25 basis points to 6 per cent, the lowest in over 6 years. The apex bank had held its repo rate at 6.25 per cent since October 2016. Though, the domestic unit resumed lower at 64.12 as compared to Tuesday's close of 64.07 at the Interbank Foreign Exchange market due to mild demand for the American currency. Later, the rupee made a resounding recovery to touch a high of 63.59 following frantic dollar unwinding from speculative traders and foreign banks.
However, suspected RBI intervention towards the fag-end trade forced the rupee to shed some weight and end at 63.70, showing a handsome gain of 37 paise, or 0.58 per cent.