Rupee up 7 paise against USD in early trade

The Indian rupee appreciated marginally by 7 paise at 48.59 in opening trade today on expectations of more capital inflows by foreign funds, tracking firming trends on the other Asian equity markets amid weak US currency overseas.

However, dollar demand from state-run banks for oil importers, capped rupee's gains to some extent. At the Interbank Foreign Exchange (Forex) market, the domestic unit recovered 7 paise to quote at 48.59 a dollar over the previous close of 48.66/68.

Yesterday, rupee ended 3 paise lower in volatile trade after BSE Sensex ended flat.

Forex dealers said hopes of increased capital inflows by foreign funds in line with better trends on the other Asian equity markets and dollar's losses against a basket of currencies mainly supported the Indian rupee.