Fresh capital outflows and almost flat local equities restricted the Indian rupee's rise, a forex dealer said.
At the interbank foreign exchange market, the Indian rupee opened slightly higher at 62.90 a dollar from the previous close of 62.93 and touched a high of 62.84.
Later, it fell in line with local stocks to a low of 63.08, before recovering to settle at 62.87, a rise of six paise, or 0.10 per cent, over Thursday's close.
"RBI was seen protecting at the 63 level. They started selling dollars at 63.02-63.03 levels and were seen till the end to the session," said a senior dealer with a state-owned bank.
The rupee has added 24 paise over the past five sessions to clock its first weekly gain in six.
The 30-share benchmark S&P BSE Sensex fell 11.66 points. Overseas investors pulled out a net Rs 59.8 crore of stocks yesterday, as per provisional data with stock exchanges.
"We saw exporters interest in the market today. They started selling at 63 as they know that the rupee is not going to fall further. Oil companies demand for dollar was not seen," said Harihar Krishnamoorthy, head of treasury at FirstRand Bank.
The dollar index was down 0.19 per cent against a basket of six major global currencies.
"The trading range for the USD/INR pair is expected to be within 62.50 to 63.50," said Pramit Brahmbhatt, CEO of Alpari Financial Services (India). (MORE) PTI VMP SBP HV Forward dollar premiums closed lower on fresh receipts by exporters.
The benchmark six-month forward dollar premium payable in April declined to 239-241 paise from 244-246 paise yesterday and far-forward contracts maturing in October dipped to 485-487 paise from 490-492 paise.
The RBI fixed the reference rate for the dollar at 63.0236 and for the euro at 84.9199.
The rupee dropped further to 101.82 against the pound from 101.44 previously. It was down to 84.98 per euro from 84.51 and improved to 62.12 per 100 Japanese yen from 62.40.