The rupee gained 21 paise to 82.38 in early trade on Tuesday against the US dollar. It closed at 82.59 against the dollar on Monday.
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 0.20 percent down at 101.43.
Crude oil benchmarks were trading higher today. At the last count, Brent crude futures were trading 0.57 percent up at $78.13 per barrel, while WTI futures were trading 0.67 percent higher as well at $73.48 per barrel.
"On Monday, the rupee halted its four-day losing streak as it jumped to 82.55 against USD. On the domestic front, FPI flows are not giving up despite equities being near all-time-high and have poured $2.5 billion in July, pushing the total to $13.9 billion for 2022. Along with the given flow story, global factors such as US DXY at a two-month low, Yen and yuan at two week high, halt in US bond yields helped rupee gather strength and move away from its multi-month low. It will surely be a roller-coaster ride for the Rupee traders, though in a constrained range of 81.80 to 82.80 for a few more days," said Amit Pabari, the managing director of CR Forex Advisors.
"Overall, there are higher chances that the pair could first move towards 82.20-82.00 levels. Nonetheless, one should remain cautious ahead of key US economic data and thus plan their hedging well," he added.
Both, Indian benchmark indices Nifty 50 and Sensex were trading in the green around 11.15am on Tuesday.
