The rupee was trading higher by 13 paise at 63.65 against the US currency in late morning deals on sustained bouts of dollar selling by banks and exporters amid a subdued dollar overseas.
The rupee opened a higher at 63.73 per dollar as against yesterday's closing level of 63.78 at the inter-bank foreign exchange here.
It strengthened further to 63.61 per dollar before quoting at 63.65 per dollar at 1100 hrs.
The Indian unit hovered between 63.76 and 63.61 during morning trade.
"Weakness in dollar overseas and sustained FII inflows lifted the rupee," a dealer said.
Foreign investors have put in more than Rs 8,200 crore in debt and equity markets in the past five trading sessions.
The US dollar were defensive against its major rivals in early Asian trade, touched a four-month low against the yen pressured by simmering concerns that the US currencys yield advantage will start to erode as major central banks head toward unwinding their massive stimulus.
The 30-share BSE Sensex was trading flat, marginally up 1.52 points or 0.00 per cent at 36,141.50 at 1040 hrs.