Mumbai, June 1 - In a volatile market, the Indian rupee ended higher by 54 paise to 55.54 against the Amerian currency due to persistent selling of dollars by banks and exporters in view weakness of dollar in New York market.

Exhibiting volatile movement, the rupee resumed lower at 56.25, as against yesterday's close of 56.08 at the Interbank Foreign Exchange (Forex) Market and hovered between 55.53 and 56.28 per dollar before settling the day at 55.54 per dollar.

Selling of dollars from banks in view of weakening of dollar in New York mainly boosted the market sentiment, a forex dealer said.

In New York, the euro recovered from an almost two-year low against the dollar yesterday on reports that International Monetary Fund has begun to explore the possibility of a bailout package for Spain.

However, in Hong Kong, the dollar resumed its northward journey today as weak economic data from China and Australia combined with euro-zone uncertainty to drain investor risk appetite ahead of the crucial U.S. non-farm payrolls data for May.

Meanwhile, RBI Deputy Governor K C Chakrabarty said the Reserve Bank cannot arrest the rupee's decline if it is caused by weak fundamentals or global factors but can only take more calibrated steps in the forex market in such a scenario. PTI