The rupee strengthened by 14 paise to 72.61 against the US dollar in opening trade on Monday on the back of positive macroeconomic data and upbeat local equities.
At the interbank forex market, the local unit opened at 72.61 against the US dollar, registering a rise of 14 paise over its previous close.
On Friday, the rupee had settled at 72.75 against the American currency.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.16 per cent to 90.33.
The rupee started on a stronger note against the greenback buoyed by upbeat risk appetite in the markets, Reliance Securities said in a research note.
On the domestic macroeconomic front, indicating some signs of recovery, industrial production recorded a positive growth of 1 per cent in December while retail inflation cooled to a 16-month low of 4.06 per cent in January.
Further, foreign portfolio investment (FPI) flows into the domestic markets and subdued dollar could also continue to support sentiments, the note said adding that Asian currencies are also trading strong this morning and could lift sentiments in the domestic markets.