The rupee strengthened by 31 paise to 62.56 against the dollar in early trade on Monday at the Interbank Foreign Exchange on increased selling of the US currency by exporters and banks.

Forex dealers said strengthening euro against the dollar and fall in oil prices overseas following a key deal between world powers and Iran on its controversial nuclear programme and a higher opening in the domestic equity market also supported the local currency.

The rupee had gained six paise to end at 62.87 on Friday after the RBI was said to have stepped in to stem the fall.

Meanwhile, the BSE benchmark Sensex recovered by 223.26 points, or 1.10 per cent, to 20,440.65 in early trade on Monday.

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