ICICI direct expects 73.50 levels to act as immediate hurdle for the currency pair.
Indian rupee is trading higher by 8 paise at 72.94 per dollar, amid buying seen in the domestic equity market.
It opened flat at 73.02 per dollar against previous close of 73.02.
At 14:29 IST, the Sensex was up 1,224.56 points or 2.52% at 49825.17, and the Nifty was up 372.30 points or 2.61% at 14653.50.
USDINR depreciated by almost 30 paise from lows as strength in dollar index coupled with higher borrowing pulled it towards 73.30 levels. However, we expect 73.50 levels to act as immediate hurdle for the currency pair, said ICICI direct.
The dollar-rupee February contract on the NSE was at Rs 73.31 in the last session. The open interest declined marginally by 4% for February series, it added.
Oil prices rose around 1% on Tuesday after major producers showed they were cutting crude output in line with their commitments on restraint, supporting a market thrown out of kilter by weak demand during the coronavirus pandemic.
The dollar hovered near a seven-week high on Tuesday, largely benefiting from a euro selloff overnight after coronavirus lockdowns choked consumer spending in Europe’s biggest economy.