The rupee appreciated 14 paise to 74.52 against the U.S. dollar in early trade on July 6 tracking weakness in the greenback and gains in the domestic equity market.
Forex traders said positive equities, steady crude oil prices, foreign fund inflows and weak U.S. currency supported the local unit.
The rupee opened at 74.53 against the U.S. dollar, then gained some ground and touched 74.52 against U.S. dollar, registering a jump of 14 paise over its previous close.
It had settled at 74.66 against the greenback on July 3.
“Cues from Asia remained firm as most Asian currencies have started with gains against the U.S. dollar this Monday morning against the greenback,” Reliance Securities said in a research note.
“We could witness further appreciation of the currency supported by gains in equities, steady crude oil prices, Reserve Bank of India shying away from buying dollars and weak U.S. currency, it added.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.22% to 96.96.
On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 418.71 points higher at 36,440.13 and broader NSE Nifty rose 138.05 points to 10,745.40.
Foreign institutional investors were net buyers in the capital market as they purchased shares worth ₹857.29 crore on July 3, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 0.56% to $43.04 per barrel.