MUMBAI: The rupee appreciated by 12 paise to 71.67 against the US dollar in early trade on Friday.
At the interbank foreign exchange, the rupee opened strong at 71.76 and gained further strength to touch a high of 71.49 against the US dollar.
The domestic currency, however, could not hold on to the gains and was trading at 71.67.
On Thursday, the rupee had slipped 3 paise to close at 71.80 against the US currency.
The BSE Sensex was trading 205.70 points, or 0.55 per cent, higher at 37,274.63, while the broader Nifty rose 61.35 points, or 0.56 per cent, to 11,009.65 in morning trade.
Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 986.58 crore on Thursday, as per provisional data.
Brent crude futures, the global oil benchmark, declined 0.02 per cent to USD 61.07 per barrel.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.02 per cent to 98.52.
The 10-year government bond yield was down at 6.55 per cent in morning trade.
With inputs from PTI