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The Indian rupee today (December 17) extended its gains against the greenback for the third day in succession by closing higher by another 25 paise at 47.66/67 though it could not keep up with the surge it saw in early trade.

The domestic unit had gained over 60 paise in the morning on hopes of fresh capital inflows following rate cut by the US Federal Reserve amid weak dollar overseas. There has been intense anticipation of inflow of dollars for the past three days which saw the rupee rose by 79 paise or 1.63 per cent.

The Philippine peso and Thai baht hit their highest levels in two months against the dollar on Tuesday as the US currency fell broadly in anticipation the Federal Reserve will cut rates to near zero to buffer an economy in recession.

The Philippine peso was one of the biggest gainers as it firmed 0.7 percent to hit as high as P47.31 to the US dollar, the strongest level since mid-October, as the country swung to a surplus in its balance of payments in November. It closed at P47.40 Tuesday.

In its statement, the Federal Open Market Committee said it had unanimously decided to cut its benchmark target interest rate by a half of one percentage point to 1% and clearly signaled it was considering further cuts. This signal came in a statement saying that the main risk facing the economy was weak growth.

Any more rate cuts would bring the funds rate to its lowest level since July 1958.