The rupee shrugged off overnight weakness against the dollar and euro on the money market on Thursday in the process of trading, dealers said.
In the fourth Asian trade, the Japanese yen and Swiss franc retreated on Thursday as the United States and Iran backed away from further conflict, with markets flipping back to the old habit of more risk-taking on hope of a US-China trade deal.
US President Donald Trump responded overnight to an Iranian attack on US forces with sanctions, not violence. Iran offered no immediate signal it would retaliate further to a Jan. 3 US strike that killed one of its senior military commanders.
The yen, regarded as a safe haven in times of geopolitical turmoil because of its deep liquidity as well as Japan's current account surplus, quickly reversed its gains made after Wednesday's missile strike.
The dollar traded at 109.19 yen, jumping back sharply from a three-month low of 107.65 yen touched on Wednesday.
The Swiss franc, another safe-haven currency, followed a similar path.
The dollar rose to 0.9740 franc from Wednesday's low of 0.96655 while the euro firmed to 1.0828 franc from 21-month low of 1.07825 set on Wednesday.
The dollar was available against the Indian rupee at Rs 71.405, the greenback was at 4.087 in terms of the Malaysian ringgit and the US currency was at 6.930 versus the Chinese yuan.
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Open Bid Rs 155.30
Open Offer Rs 155.70
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Bid Rate Rs 154.88
Offer Rate Rs 154.90
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Following slight decrease in buyers' interest in the market, the greenback could not sustain its worth and ended lower for buying and selling at Rs 155.20 and Rs 155.95 against the overnight closing rate of Rs 155.50 and Rs 156.00 respectively, local currency dealers said.
Besides, the national currency significantly improved its worth in relation to the pound sterling. The pound's buying and selling rates declined from the Wednesday's closing of Rs 202.50 and Rs 204.50 to Rs 201.60 and Rs 203.50 respectively, they added.
The dollar opened at Rs 156.30 (buying) and Rs 156.40(selling) against last rate of Rs 155.40 (buying) and Rs 155.50 (selling).
It closed at Rs 156.30 (buying) and Rs 156.40 (selling). The buying and selling rates of one tola of gold were Rs 91,200 (selling) and Rs 91,000 (buying) in the local Sarafa (gold) markets of Islamabad and Rawalpindi.