The Indian rupee appreciated by 16 paise to 44.57 a dollar in early trade today on the back of fresh capital inflows by foreign funds into equities.
At the Interbank Foreign Exchange (Forex) market, the rupee strengthened by 16 paise to 44.57 a dollar. The domestic currency had closed 41 paise lower at 44.73/74 in the previous session.
Forex dealers said the rupee strengthened against the US currency on fresh capital inflows by foreign funds into equities and dollar selling by banks, but gains were limited ahead of the RBI's credit policy.
Meanwhile, the Bombay Stock Exchange benchmark Sensex, after a five-session downward march, recovered by 94.36 points, or 0.54 per cent, to 17,495.04 in opening trade today.