The rupee spurted by 22 paise to 74.44 in early trade on Monday on softer crude oil prices and revived hopes of a diplomatic solution to the Russia-Ukraine crisis.
The local currency opened on a strong note at 74.51 to a dollar at the interbank foreign exchange market against the previous close of 74.66 on Friday.
The rupee gained further ground to trade at 74.44 at 1030 hours, supported by benign crude oil prices.
Reports suggested that the US and Russia have agreed to hold a summit on the Ukraine standoff, calming jittery investors. The reports also suggested that one of the preconditions for the summit is that Russia would not invade Ukraine, raising hopes of a diplomatic solution to the crisis.
Of late, crude oil prices have spurted on fears of supply disruption due to a possible invasion of Ukraine by Russia.
The Brent Crude on Monday dropped by 0.34 per cent to USD 93.22 per barrel. The US dollar index also edged lower by 0.21 per cent to 95.84.
Meanwhile, on the domestic equity front, the BSE Sensex was trading lower by 398.17 points at 57,434.80 and the NSE Nifty dropped 93.20 points to 17,183.10 in late morning deals.