Rupee rises 11 paise to 73.49 against the dollar in early trade

The rupee strengthened by 11 paise to 73.49 against the US dollar in opening trade on Wednesday, supported by foreign portfolio flows and strong opening in domestic equities.

Traders said that weakening of the American currency in the overseas market also supported the local unit.

At the interbank forex market, the domestic unit opened at 73.58 against the US dollar, then gained further ground and touched 73.49, registering a rise of 11 paise over its previous close.

On Tuesday, the rupee surged by 30 paise to settle at a one-and-a-half month high of 73.60 against the US dollar.

"RBI’s presence in the market and a steady US dollar could also keep appreciation bias limited," Reliance Securities said in a research note adding "dollar inflows into local equities could keep depreciation bias limited".

Further, investors have turned cautious globally ahead of key events looming for the markets, it said.

Uncertainty around Brexit, the progress of a fiscal spending package through US Congress and the outcome of Thursday's ECB meeting have made traders temporarily cautious, the report said.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.17 per cent down at 90.81.

On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 322.07 points higher at 45,930.58 and broader NSE Nifty surged 96.60 points to 13,489.55.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 2,909.60 crore on Tuesday, according to provisional exchange data.

Brent crude futures, the global oil benchmark, fell 0.33 per cent to USD 48.68 per barrel.