Weekly review: Rupee continues its undisputed performance vs USD; at fresh 20-month high of 64.28

New Delhi: The Indian rupee continued its undisputed performance against the US currency and ended at a fresh 20-month high of 64.28 on the back of frantic dollar unwinding by speculative traders amid escalating geo-political jitters.

Heightened global volatility and nervousness largely characterized foreign exchange market sentiment reacting to the geopolitical developments in the face of US air strikes against Syria putting renewed pressure on Asian currencies.

Though, the home currency withstood a mid-week jittery it witnessed wide swings between 64.16 on the higher end and 65.17 at the lower end, finally closing with solid 57 paise gain against the dollar.

Improving macro fundamentals and growing expectations of more reforms that will boost long-term economic growth and improve the investment climate mainly attracted healthy foreign inflows, helping rupee to maintaining its strong upbeat trend.

A highly volatile dollar overseas along with uncertainties surrounding US President Donald Trump's fiscal policy helped the rupee close higher too even as speculative traders and exporters offloaded their long dollar bets.

The overall forex market sentiment also got a leg-up after the RBI projected India's growth at 7.4 percent for the current fiscal, up from 6.7 percent.

However, the apex bank kept its benchmark lending rate unchanged at 6.25 percent for the third review in a row, citing upside risk to inflation.

This is the seventh-straight week surge for the rupee and appreciated by a whopping 273 paise against the dollar.

However, after an initial decline, the dollar changed course and surged to fresh weekly highs against most of its major rivals.

At the Interbank Foreign Exchange market, the rupee resumed marginally higher at 64.80 from last Friday's close of 64.85 but soon lost momentum and drifted to a low of 65.17.

But, quickly regained its solid strength, the local unit hit a fresh high of 64.16 before ending at 64.28, showing a smart gain of 57 paise, or 0.88 percent.

This is the highest for the rupee since August 11, 2015 -- when it had ended at 64.19 against the greenback.

In worldwide trade, the greenback shot-up to three- week high following positive commentes from an influential Federal Reserve official said the U.S. Central bank's plan to shrink its bond portfolio this year would not significantly delay its interest rate-hiking cycle, despite sluggish pace of US job growth.

Renewed geopolitical tensions after the United States launched cruise missiles at an airbase in Syria, an ally of Russia also supported the dollar buying.

The dollar index a measure of the US currency against a basket of peers climbed further to settle at 101.08 from last weekend level of 100.42.

With PTI Inputs