The rupee gained 22 paise to 60.97 against the dollar in early trade on Tuesday at the Interbank Foreign Exchange market on increased selling of the US currency by exporters amid a higher opening in the domestic equity market.
Besides, the WPI inflation that eased to a nine-month low in February, raising expectations that the RBI would leave interest rates unchanged at its policy review next month, supported the rupee, forex dealers said.
In volatile trade, the rupee had shed two paise to close at 61.19 in the previous session on Friday.
Forex and Money markets remained closed yesterday for 'Holi' festival.
Meanwhile, the benchmark BSE Sensex rose 137.66 points, or 0.63%, to 21,947.46 in early trade on Tuesday.