Indian rupee, the local currency appreciated 13 paise to 75.45 against on Tuesday's opening bell amid weakness in the American currency, tracking gains in the domestic equity market.
Although positive domestic equities and weak dollar supported the rupee, while foreign fund outflows and concerns over rising COVID-19 cases weighed on investor sentiments.
The rupee opened at 75.48 per US dollar at the interbank forex exchange and later gained further ground to touch 75.45 per dollar, rising 13 paise over its previous close of 75.58 on Monday.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.07 per cent to 97.46.
The 30-share BSE benchmark Sensex was trading 152.30 points higher at 35,113.82 and broader NSE Nifty rose 51 points to 10,363.40.
Foreign institutional investors were net sellers in the capital market as they sold shares worth Rs 1,937.06 crore on Monday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, fell 0.62 per cent to USD 41.45 per barrel.
Meanwhile, the number of cases around the world linked to the disease has crossed 1.02 crore and the death toll has topped 5.04 lakh.
In India, the death toll due to COVID-19 rose to 16,893 and the number of infections spiked to 5,66,840, according to the health ministry.
(Edited with PTI inputs)