Mumbai, November 1
The rupee today hit a fresh 9-1/2 year high before ending at 39.3100/3150 per dollar, marginally higher from previous close of 39.32/33 buoyed by the US federal reserve’s rate cut yesterday amid a slide in equity market.

Initially, the currency touched a new 9-1/2 year high of 39.22 a dollar following an initial spurt of 366 points in the stock market benchmark Sensex.

In active trade at the forex market, the Indian unit moved in a range of 39.22 and 39.34 during the day after resuming firm at 39.22/24 a dollar.

Intially, surge in the currency against dollar was largely attributed to a 25 basis point rate cut by the US federal reserve last night and a strong rally in equity market this morning amid absence of worthwhile dollar demand.

The central bank did not intervene aggressively but again prevented the rupee's sharp rise, forex dealers said. The rupee fell from early highs mainly because of weakness in equity markets in the latter part of the day, they added.

Meanwhile, finance minister P Chidambaram said the US Fed’s interest rate cut was expected and already factored in by the RBI in the quarterly review of the monetary policy on October 30.

News that India's exports increased by 19.26 per cent in September despite a rise in rupee value against the greenback also had a sentimental impact on the forex market.

The benchmark Sensex today ended 114 points lower while Asian indices generally closed in negative territory.

The RBI fixed the reference rate for the US currency at Rs 39.32 per dollar and for the single European unit at Rs 56.9 per euro.