The rupee bounced back to hit 47.37/38 a dollar today, helped by a weakness in the US currency and hopes of a spurt in foreign investments with the return of the Manmohan Singh-led government at the centre.
The rupee hit a high of 47.28 before closing at 47.37/38 against the greenback, still above Wednesday's close of 47.47/48.
The Indian unit had hit a 5-month high of 47.27 against the dollar on Tuesday.
The rupee has gained 4.3 per cent against the dollar this week after the Congress-led coalition swung back to power with a near majority in the general elections.
Overseas investors have bought over $1 billion worth of equity in the local market after the election results were declared and a total of $3 billion of equities so far this month.
The dollar also hit a five-month low against a basket of currencies helping the rupee rise further.