The Indian rupee rallied on Friday to climb above 83.50 per U.S. dollar for the first time since late July, boosted by dollar sales by foreign banks and a rise in most of its Asian peers. The rupee was at 83.

At the interbank foreign exchange market, the Indian currency opened at 83.70 and inched up to 83.69 before trading at 83.70 against the greenback, registering a gain of 6 paise from its previous closing level.

Falling crude oil prices provided support to the Indian currency, though it was partially weighed down by foreign fund outflows, according to forex traders. At the interbank foreign exchange market, the rupee opened at 83.

The Indian rupee's recovery on Thursday will have to contend with a broadly higher U.S. dollar despite the Federal Reserve delivering a 50-basis-point rate cut. The 1-month dollar/rupee non-deliverable forward (NDF) declined to 83.

The rupee has strengthened against the dollar following the US Fed's rate cut and positive economic commentary. Market experts predict further gains in the rupee as the interest rate differential between India and the US widens.