The Indian rupee pulled back from its highest level in nearly a week on Monday afternoon as the dollar gained against major currencies, but firm domestic shares continued to cheer sentiment.
At 1:50 pm, the partially convertible rupee was at 46.16/17 per dollar off a high of 46.07, its highest since June 22 but still above its close of 46.27/28 on Friday.
Indian shares were trading up 0.8 percent, with Reliance Industries and Oil & Natural Gas Corp leading the rise.
The index of the dollar against six major currencies was up 0.1 percent.
The dollar edged up on Monday after faltering in Asia on concerns about U.S. economic recovery, while the euro failed to make headway after a G20 summit failed to set markets alight.
One-month offshore non-deliverable forward contracts were quoted at 46.39, weaker than the onshore spot rate.
In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were both at 46.3200, with the total traded volume on the two exchanges at about $4.9 billion.