The rupee rose in early trade today amid predictions that Sensex and Nifty were likely to open higher after exit polls showed Narendra Modi-led NDA government was set to return to power on May 23.
The Indian currency opened higher by 73 paise at 69.49 per dollar on Monday versus previous close of 70.22. On Friday, the rupee fell 20 paise to close at 70.23 level against the US dollar on rising crude oil prices and foreign fund outflows weighed on investor sentiment. The currency started the day at a two-week high level.
Positive equity market sentiment after exit polls predicted landslide victory for the Narendra Modi government helped the domestic currency open higher in trade today.
"If the outcome [the general election results on May 23] matches the exit polls, then the rupee may head towards 68 levels in coming sessions," said Rushabh Maru, currency and commodity analyst with Anand Rathi Shares and Stock Brokers.
Last week, the rupee fell by 31 paise. That was the second straight week of loss for the domestic currency.
Meanwhile, Sensex opened 850 points higher and Nifty rose 278 points in early trade cheering exit polls which signalled Narendra Modi was set to sweep Lok Sabha elections with a huge victory.