The rupee on Friday appreciated further against the US currency during Friday morning trading, buoyed by fairly heavy FII inflows in the equity markets, which surged by about 143 points in early trade.
The dollar's weakness against other Asian currencies also aided the rupee sentiment.
In quiet trade at the Interbank Foreign Exchange (forex) market, Indian unit resumed firm at 42.77/78 a dollar from overnight close of 42.84/85 a dollar and later was quoted at 42.78/79 per dollar in late morning deals.
Forex dealers said the rupee drew support from a strong trend in equity markets on the back of impressive Q4 financial results announced by IT major Infosys Technologies.
The capital inflows in four days beginning April 5 amounted to USD 372.90 million. The rupee is expected to rally further in anticipation of heavy dollar selling by banks ahead of the first impact of the CRR hike, a forex dealer commented.