Rupee inches 2 paise higher to 73.35 against US dollar in early trade

The rupee opened on a flat note and inched 2 paise higher to 73.35 against the US dollar in early trade on Tuesday, even as the domestic equity market was trading with gains.

At the interbank forex market, the domestic currency was trading in a narrow range. It opened at 73.36 against the greenback, gained some ground and touched 73.35, up 2 paise from its previous close.

On Monday, the rupee settled at 73.37 against the US dollar.

"Rising COVID-19 cases, impasse over the US stimulus spending and uncertainty surrounding the US elections are keeping investors away," Reliance Securities said in a research note.

Further, most of the Asian currencies have started marginally weak against the US dollar this morning and could weigh on sentiments, it added.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.03 per cent to 93.39.

On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 116.04 points higher at 40,547.64, and the broader NSE Nifty rose 35.15 points to 11,908.20.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 1,656.78 crore on a net basis on Monday, according to exchange data.

Brent crude futures, the global oil benchmark, fell 0.84 per cent to $42.26 per barrel.