Erasing most of its early gains, the rupee on Tuesday rose by nine paise to 59.43 in the late morning trade on dollar selling by banks and exporters as foreign funds continued pouring capital into domestic equities.
The domestic currency resumed slightly higher at 59.50 per dollar as against the previous closing level of 59.52 per dollar at the Interbank Foreign Exchange (Forex) Market and moved up further to 59.17 per dollar.
However, it failed to maintain gains and was quoted at 59.43 per dollar at 1050 hrs.
It moved in a range of 59.17 per dollar and 59.50 per dollar during the morning deals.
Persistent capital inflows from foreign funds into equity market mainly boosted the rupee value against the dollar, a forex dealer said.
However, in New York, the dollar rose against the Japanese yen yesterday after data showed improvement in US manufacturing.
Meanwhile, the BSE benchmark Sensex declined by 47.64 points, or 0.24 per cent, to 19,529.75 at 1050 hrs.