Indian rupee ended lower by 9 paise at 73.06 per dollar, amid buying saw in the domestic equity market.
It opened flat at 72.95 per dollar against Wednesday's close of 72.97 and traded in the range of 72.94-73.12.
At close, the Sensex was up 358.83 points or 0.69% at 52,300.47, and the Nifty was up 102.40 points or 0.65% at 15,737.80.
"Rupee traded in a small range with the weak tone, around 72.95 compared to 72.89 yesterday. Higher crude prices with stable dollar prices since few days kept rupee rise at check near 72.80 zones," said Jateen Trivedi, Senior Research Analyst at LKP Securities.
"Going ahead US CPI data will play a vital role in the movement of the dollar index which will affect the USDINR pair. The range of the rupee can be between 72.75-73.25 in coming sessions ahead," he added.
Oil prices slid on Thursday as inventory data in the United States, the world's top oil consumer, showed a surge in gasoline stocks that indicates weaker-than-expected fuel demand at the start of summer, the country's peak season for motoring.
The dollar continued to hover near a five-month low versus major peers on Thursday as investors looked to key U.S. inflation data and a European Central Bank meeting later in the day to potentially set the direction for currency markets.
Gold prices were subdued on Thursday, weighed down by a firmer dollar, as investors sat on the sidelines waiting for clearer signals on inflation levels and economic growth ahead of U.S. data and the European Central Bank meeting later in the day.
“The USDINR spot is hovering around 73 zone, whether it will bounce or not depends on US CPI. The fx traders await some guidance from CPI data and ECB policy. An upbeat CPI data won’t provide an excuse for the Fed to defer the tapering debate a little longer but all will be revealed at the June 16th FOMC meeting," said Rahul Gupta, Head Of Research- Currency, Emkay Global Financial Services.
"Until then in USDINR spot, 73.25-73.30 is a crucial resistance, a consistent above that can push prices towards 73.60-73.75 zone while 72.75-72.50 will act as a crucial support,” Gupta added.