The Indian rupee appreciated 39 paise against the US currency on Tuesday in early trade on dollar selling by banks and exporters amid hopes of firm opening on the domestic stock markets in tandem with positive trends on other Asian bourses.
At the Interbank Foreign Exchange (Forex) market, the domestic currency traded higher at 48.86 against the US currency, a rise of 39 paise over the previous close of 49.25/27 a dollar on Friday.
The rupee fell by 11 paise to close at 49.25/27 a dollar on Friday. The forex market remained closed on Monday on account of "Republic Day".
Forex dealers said fresh capital inflow on expectations of firm opening on domestic stock exchanges and dollar selling by banks, aided Indian currency.
Among Asian markets, Japan's Nikkei was up almost 4.21 per cent, while Hong Kong's hang Seng was down 0.63 per cent in early trade on Tuesday.