The Indian rupee gained 18 paise to 46.86 against the U.S. dollar in early trade on the Interbank Foreign Exchange today amid a fall in the value of the American currency against its major rivals.
Capital inflows by foreign funds into equities, too, supported the rupee sentiment.
The rupee had closed 11 paise lower at 47.04/05 against the dollar in yesterday’s volatile session.
Forex dealers said apart from dollar losses overseas against a basket of currencies, foreign capital inflows into Indian markets also provided support to the rupee.
However, the cautious approach exercised by investors ahead of the Reserve Bank of India’s monetary policy review, which is scheduled later in the day, restricted the gains.
Meanwhile, the Bombay Stock Exchange benchmark Sensex rose by 57.09 points, or 0.31 per cent, to 18,077.14 points in opening trade today.