The rupee on Tuesday settled almost flat at 74.41 against the US dollar after its initial gains were erased despite strong equity markets.
Despite the early bounce, the home unit appeared to struggle, even as the dollar remained broadly weak.
The rupee opened sharply higher at 74.34 amid heavy buying in local stock markets. The domestic currency rushed to hit the day’s high of 74.25.
It gave up initial gains to finally settle at 74.41, showing gain of just 1 paisa over the previous close.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.42 per cent to 93.75.
On the domestic equity market front, BSE benchmark Sensex was trading 488.74 points higher at 40,246.32, and the broader NSE Nifty rose 136.40 points to 11,805.55.
Foreign institutional investors emerged as net buyers in the capital market as they purchased shares worth Rs 740.61 crore on Monday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 1.72 per cent to USD 39.64 per barrel.