The Indian rupee appreciated by 5 paise to 94.53 against the US dollar in early trading on Tuesday, driven by positive market sentiment and dollar selling by exporters.
At the interbank foreign exchange market, the domestic currency opened at 94.69 and then gained momentum to touch 94.53 in initial trade, marking a rise of 5 paise from its previous close of 94.58.
Forex traders attributed the rupee's strength to a weak US dollar overseas and sustained foreign fund inflows. However, concerns over rising crude oil prices and global economic uncertainties capped the gains.
The rupee is expected to trade in a range of 94.50 to 94.80 in the near term, analysts said, as markets await cues from the US Federal Reserve's policy stance and domestic macroeconomic data.
