Breaking a two-session losing run, the rupee today claimed some of its lost ground to end higher by 3 paise at 64.76 against the US dollar ahead of the release of minutes from January's FOMC meeting.
The home currency largely managed to withstand early sharp volatility before recovery.
It plunged to hit a fresh three-month low of 64.95 in intra-day levels - its lowest since November 22 - tracking overnight greenback strength.
The rupee had depreciated by a staggering 88 paise in the recent spell of sell-offs.
Growing uncertainties over an impending Fed rate hike along with heavy capital outflows predominantly impacted the sentiment at the forex market.
A high degree of caution prevailed on the trading front ahead of an outcome from the US Federal Reserve's January meeting minutes, which may signal the pace of any interest-rate rises.
Earlier in the day, maintaining its bearish undertone, the Indian unit resumed sharply lower at 64.90 from Tuesday's closing value of 64.79 at the Interbank Foreign Exchange (forex) market due to heavy demand for the American currency from importers.
After drifting to a fresh 3-month low of 64.95 in late afternoon deals, the home unit managed to pull back swiftly as state-run banks, likely on behalf of the central bank and exporters stepped up greenback sales.
It briefly touched session's high of 64.72 before settling he day at 64.76, showing a small gain of 3 paise, or 0.05 per cent.
The RBI, meanwhile, fixed the reference rate for the dollar at 64.8161 and for the euro at 79.9442.
In the meantime, foreign direct investment (FDI) in the country grew by a meagre 0.27 per cent to USD 35.94 billion during the first 9 months of the current fiscal, according to the DIPP data.
The FDI inflows were USD 35.84 billion during the April-December period of the last fiscal, 2016-17.
On the international energy front, global crude prices continued to slide, largely weighed down by a rebound in the US dollar and also surge in US production forecast.
Brent crude futures were trading lower at USD 64.97 a barrel in early Asian trading.
Meanwhile, domestic equities snapped their three-day losing streak and staged a modest rebound on the back of healthy buying in select beaten-down stocks along with active short-covering by the general investors ahead of the expiry of derivative contracts for February tomorrow.
The benchmark BSE-Sensex recovered over 142 points to end at 33,844.86, while Nifty rose 37 points at 10,397.45.
Globally, the US dollar was hovering at a one-week high against other major currencies, as investors were eyeing the release of the minutes of the Federal Reserve's latest policy meeting despite sustained US deficit worries.
The dollar index, which measures the greenback's value against a basket of six major currencies, was up at 89.99 in early trade.
In cross-currency trades, the rupee rebounded against the pound sterling to close at 90.15 per pound from 90.57 and strengthened against the euro to finish at 79.78 compared to 79.95 yesterday.
The home unit also edged higher against the Japanese yen to end at 60.28 per 100 yens from 60.49 earlier.
Elsewhere, the pound sterling rebounded after a brief intra-day fall after the UK reported a rise in the unemployment rate to 4.4 per cent in December and despite a drop in jobless claims in January amid BREXIT uncertainty.
The common currency euro, however, remained under downward pressure despite weak greenback.
In forward market today, premium for dollar declined owing to sustained receiving from exporters.
The benchmark six-month forward premium payable in July eased to 126-128 paise from 127-129 paise and the far- forward January 2019 contract also softened to 260-262 paise from 262-264 paise previously.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)