The Indian rupee trimmed its earlier gains but was still quoted higher by 17 paise to 54.89 against the American currency in the late morning trade on sustained selling of dollars by banks and exporters on the back of weak dollar in the overseas market.
The rupee resumed higher at 54.81 per dollar as against the last closing level of 55.06 per dollar at the Interbank Foreign Exchange (Forex) Market and hovered in a range of 54.79 per dollar and 54.92 per dollar before quoting at 54.89 per dollar at 1040 hrs.
Persistent selling of dollars by banks and exporters in view of lower dollar in the overseas market mainly boosted the rupee value against the dollar, a forex dealer said.
In New York, the dollar lost ground yesterday coming off its highest level against a basket of currencies since early September, as investors grew cautiously upbeat over efforts to avert the so-called fiscal cliff and stifled the currency's haven-related support.
Meanwhile, the Indian benchmark Sensex firmed up by 64 points, or 0.35 pct, to 18,402.97 at 1050 hrs.