Reuters Market Eye - The rupee extends gains to 54.27/28 versus its previous close of 54.3750/3850, tracking gains in the domestic sharemarket.
The BSE Sensex trading up 0.2 percent.
Traders say USD/INR pair to remain rangebound until the Reserve Bank of India's policy on May 3 when it is widely expected to cut rates by 25 basis points.
Most Asian currencies trading stronger versus the dollar.
Lack of dollar supplies preventing further losses in pair, traders say.
(Reporting by Swati Bhat)