The Indian rupee appreciated by 12 paise to 70.80 against the US dollar in early trade on Wednesday as positive opening in domestic equities and easing crude oil prices strengthened investor sentiments.
At the interbank foreign exchange the rupee opened at 70.87, then gathered momentum and touched a high of 70.80 against the US dollar, registering a rise of 12 paise over its previous close.
On Tuesday, rupee had settled for the day at 70.92 against the US dollar.
The domestic unit however could not hold on to the gains and was trading at 70.83 against the dollar at 0933 hrs.
Forex traders said investors were optimistic about the US-China trade talks.
According to a media report, US and Chinese officials are working on a deal to postpone tariffs set to hit Chinese imports from December 15.
Domestic bourses opened on a positive note on Wednesday with benchmark indices Sensex trading 70.18 points higher at 40,310.06 and Nifty higher by 13.50 points at 11,870.30.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.10 per cent to 97.50.
Foreign institutional investors (FIIs) remained net sellers in the capital market, as they sold shares worth Rs 366.79 crore on Tuesday, according to provisional exchange data.Brent crude futures, the global oil benchmark, fell 0.68 per cent to trade at USD 63.90 per barrel.
The 10-year government bond yield was at 6.71 per cent in morning trade.