The rupee appreciated by 10 paise to 72.77 against the US dollar in opening trade on Friday supported by positive domestic equities and sustained foreign fund inflows.
At the interbank forex market, the local unit opened at 72.79 against the US dollar, then inched higher to 72.77 against the greenback, registering a rise of 10 paise over its previous close.
On Thursday, the rupee had settled at 72.87 against the American currency.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, advanced 0.07 per cent to 90.48.
"The US dollar Index has started flat this morning in Asian trade as the markets look to fresh triggers in the market. Upside remained limited as new signs of weakness in the US jobs market dented investor expectations about the pace of a pandemic recovery," Reliance Securities said in a research note.
Market participants will be keeping an eye on inflation and industrial production numbers and better-than-estimate numbers could extend gains for the currency, forex traders said.
On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 94.63 points higher at 51,626.15, and the broader NSE Nifty advanced 24.45 points to 15,197.75.
Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 944.36 crore on Thursday, according to exchange data.
Brent crude futures, the global oil benchmark, fell 0.62 per cent to USD 60.76 per barrel.
