The Indian rupee appreciated sharply by 40 paise against the dollar in early trade today largely on the back of fresh capital inflows by foreign funds into equities.
At the Interbank Foreign Exchange (Forex) market, the rupee strengthened by 40 paise to 45.08 a dollar. The domestic currency had closed 18 paise lower at 45.45/49 in the previous session on Friday.
Dealers said the rupee strengthened against the US currency as foreign funds poured money into equities and the US dollar lost overseas against other major currencies.
Meanwhile, the Bombay Stock Exchange benchmark Sensex rose by 260.06 points, or 1.55 per cent to 17,029.17 in the opening trade today.