The rupee strengthened by 42 paise to 85.34 against the US dollar in early trade on Tuesday, supported by a sharp decline in the greenback and positive cues from domestic equity markets.
According to forex traders, the US dollar index weakened in global markets amid concerns over the Federal Reserve’s independence, as former President Donald Trump’s influence on monetary policy appears to be resurging.
Additionally, subdued Brent crude prices provided relief to India’s import bill, offering support to the rupee and easing inflationary pressures.