The Indian rupee surged further by 14 paise to a seven-week high of 49.88/90 against the greenback on Monday, driven higher by a bullish equity market, raising hopes of consistent capital inflows amid low demand for dollars.

The domestic unit resumed stronger at 49.85/90 a dollar from its previous close of 50.02/03 a dollar and later moved in a range of 49.82 and 49.95 during the day.

Dealers at the Interbank Foreign Exchange (forex) market said the Indian currency drew support from a firm equity market, which extended its gain to the seventh straight day on Monday.

They said the portfolio inflows, the principal driver for the rupee, are expected to continue as the local stocks remained bullish amid optimism about further monetary measures by the Reserve Bank of India.

Some banks covered dollar positions in the afternoon trade, a leading banker said.

Foreign institutional investors (FIIs) bought shares amounting to nearly $300 million in April so far. The activity, however, was at a low ebb as global players were conspicuous by their absence in view of the Easter holidays.