The rupee strengthened by 2 paise to 82.61 against the US dollar in early trade on Tuesday amid weakness in the American currency against major overseas rivals and positive domestic equity markets.
Falling crude oil prices also supported the Indian currency, though foreign fund outflows capped a sharp gain, forex dealers said.
In the interbank forex market, the domestic unit opened at 82.58 and then touched a low of 82.62. It later traded at 82.61 against the greenback, registering a gain of 2 paise over the previous close.
On Monday, the rupee closed at 82.63, up by 1 paisa against the US dollar.
The Indian currency has been trading in a narrow range as market participants await the US Non-Farm Payrolls data to be released on Friday. Also, a close watch on the Chinese currency’s reaction to the country’s slowing factory output and other macroeconomic indicators weighed on the rupee, said forex analysts.
Meanwhile, the dollar index, which measures the greenback’s strength against a basket of six currencies, was trading 0.20 percent lower at 103.85.
Brent crude futures, the global oil benchmark, were down 0.05 per cent at $84.38 a barrel.
In the domestic equity market, the 30-share BSE Sensex was trading 182.08 points, or 0.28 per cent, higher at 65,178.68. The broader NSE Nifty gained 53.65 points or 0.28 per cent to 19,359.70.
Foreign institutional investors (FIIs) were net sellers in the capital markets on Monday as they offloaded shares worth ₹1,393.25 crore, according to exchange data.
