Rupee gains 21 paise against dollar in opening trade

A man walks past pictures of U.S. dollar bills and other currency on display outside a money changing outlet in Bangalore. File photo

The Indian rupee rose sharply by 21 paise to Rs. 45.94 per U.S. dollar in early trade on the Interbank Foreign Exchange on Monday amid dollar weakness against a basket of other Asian currencies overseas and a rebound in the domestic stock market.

Forex dealers said dollar weakness against other major Asian currencies overseas and a strong recovery in the domestic stock market in early trade Monday helped the rupee to strengthen, but some month-end dollar demand from importers capped the gains.

The rupee had ended 11 paise lower at Rs. 46.15/16 against the U.S. dollar in the previous session on Friday due to sustained demand for the American currency from importers amid distinctly weak equities.

Meanwhile, the Bombay Stock Exchange Sensex recovered sharply by 326.37 points, or 2.06 per cent, to 16,175.20 in early trade Monday.