The rupee gained 12 paise in early trade on Friday to 81.96 against the US dollar. It settled at 82.08 in Thursday's session agains the USD.
The dollar index — which measures the American currency against the yen, the pound, the Canadian dollar, the Swedish krona, the Swiss franc and the euro — was last trading at 99.438.
Crude oil benchmarks were trading flat today. At the last count, Brent crude futures were trading 0.02 percent up at $81.39 per barrel, while WTI futures were trading 0.07 percent higher as well at $76.94 per barrel.
"The Indian rupee concluded its fourth consecutive session with gains on Thursday, benefiting from a significant weakness in the dollar. This was primarily driven by a sharp decline in US treasury yields across all maturity periods as key inflation indicators in the US, such as CPI, PPI, and PCE, indicated a decrease in inflation, leading to a shift in the Federal Reserve's hawkish stance," said Amit Pabari, the managing director of CR Forex Advisors.
He said caution needs to be maintained as volatility in the USD-INR pair is at a record low and there is a higher probability that it will fall sharply, tracking broad weakness in the DXY. "The USD-INR has strong support near the 81.80-70 zone, which, if taken out, it could move down towards 81.50 levels. 82.20 would act as strong resistance for the pair in the near term," he said.
