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.

The US dollar index slipped to multi-month lows of around 101 level from a three-month high of 106 as investors ratcheted up bets for an aggressive US Fed rate cut

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.