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The rupee advanced 22 paise to 76.78 against the US dollar in the opening trade on Wednesday, supported by the weakness in the American dollar and recovery in domestic equity markets.
Forex traders said the rupee could remain range-bound and can witness high volatility amid the deepening Russia-Ukraine conflict.
At the interbank foreign exchange, the rupee opened at 76.90 against the US dollar, then gained momentum and touched 76.78, registering a gain of 22 paise from the previous close.
On Tuesday, the rupee fell for the fifth consecutive day and depreciated by 7 paise to close at a lifetime low of 77 against the US dollar, weighed by surging crude oil prices.
The Indian rupee could remain range-bound this Wednesday and will continue to witness high volatility, said Sriram Iyer, senior research analyst at Reliance Securities.
The dollar fell, while a recovery in the domestic equity markets could cap weakness. However, oil continued to move higher after the US ban on Russian energy products and could cap the appreciation bias, Iyer noted.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.05 per cent to 99.01.
Meanwhile, global oil benchmark Brent crude futures jumped 2.59 per cent to USD 131.29 per barrel.
On the domestic equity market front, the 30-share Sensex was trading 550.95 points or 1.03 per cent higher at 53,975.04, while the broader NSE Nifty rose 117.70 points, or 0.74 per cent, to 16,131.15.
Foreign institutional investors remained net sellers in