The rupee gained 22 paise to 82.36 against the U.S. dollar in early trade on March 1 amid a positive trend in domestic equities.
Forex traders said sustained foreign fund outflows weighed on the local unit and restricted the appreciation bias.
At the interbank foreign exchange, the domestic unit opened at 82.48 against the dollar, then gained ground and rose to 82.36, registering a rise of 22 paise over its previous close.
On Tuesday, the rupee closed at 82.58 against the U.S. currency.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.02% to 104.84.
Brent crude futures, the global oil benchmark, advanced 1.75% to $83.89 per barrel.
In the domestic equity market, the 30-share BSE Sensex rose 202.36 points or 0.34% to 59,164.48 points. The broader NSE Nifty advanced 60.80 points or 0.35% to 17,364.75 points.
Foreign Institutional Investors (FIIs) were net sellers in the capital market on Tuesday as they offloaded shares worth ₹ 4,559.21 crore, according to exchange data.
On the domestic macroeconomic front, India's economic growth decelerated to 4.4% in October-December this fiscal year mainly due to a contraction in the manufacturing sector.
The GDP (Gross Domestic Product) growth was 11.2% in October-December 2021 and 6.3% in July-September 2022, showed the data released by the National Statistical Office (NSO) on Tuesday.
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