The rupee was seen trading at 60.01/02 after hitting 59.95, its highest since April 9 but still stronger than its close of 60.135/145 on Wednesday, tracking gains in the domestic share market.
Dealers said good demand for dollars from oil firms seen around 60 levels.
Traders expect the rupee to hold in a 59.90 to 60.20 range during the session, and domestic shares would be watched for cues on foreign fund flows.
The BSE Sensex was trading up 0.2 per cent.
Asian shares drew a measure of comfort from dovish comments by the US Federal Reserve chief and signs of easing tensions in Ukraine after Russian President Vladimir Putin called on pro-Moscow separatists to postpone a succession vote.
Traders, however, said losses in other Asian currencies and the dollar's gains versus the euro will limit a sharp fall in the USD/INR pair.
Copyright: Thomson Reuters 2014
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