The Indian rupee appreciated by 20 paise to 46.56 a dollar in early trade on the Interbank Foreign Exchange on Wednesday, tracking stronger Asian currencies.
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The rupee had closed almost flat at 46.76/77 against the dollar in Tuesday's trading.
Forex dealers said apart from firming Asian currencies and the euro against the dollar, increased capital inflow into equities by foreign funds also provided support to the rupee.
Meanwhile, the Bombay Stock Exchange index, Sensex rose by 181.32 points, or one per cent, to 18,167.22 points in the opening trade on Wednesday.
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