The rupee pared its initial gains, but was still trading higher by 10 paise at 66.06 against the US currency on bouts of dollar selling by banks and exporters.
The rupee resumed higher at 66.11 per dollar against last close of 66.16 at the Interbank Foreign Exchange (Forex) market.
It gained further on bouts of dollar selling to 66.01 before quoting at 66.06 at 1030 hrs. It hovered in a range of 66.11 to 66.01 per dollar during the morning deals.
In global markets, the US dollar was up against the basket currencies in early lacklustre Asian trade amid relatively uneventful weekend with the dollar showing potential for gains if upcoming data strengthen the case for a hike in interest rates this year.
The dollar index currently trading up by 0.05 per cent at 96.27 as against a basket of six currencies.
Meanwhile, the benchmark BSE Sensex was trading lower by 19.40 points to 25,844.10 at 1045hrs.
