The rupee appreciated 17 paise to 81.55 against the US dollar in early trade on Wednesday on broad dollar weakness and a positive trend in domestic equities.

At the interbank foreign exchange, the domestic unit opened at 81.63 against the dollar, then gained ground to touch 81.55, registering a rise of 17 paise over its previous close.

On Tuesday, the rupee declined 4 paise to close at 81.72 against the US dollar.

Forex traders said investors will focus on the US Federal Reserve Chairman Jerome Powell's speech and the release of key domestic macro economic data for further cues.

"Market is looking forward to Fed Chair Powell's speech today. He is likely to signal a slowdown in the pace of rate hikes but push back against expectations of a pivot," IFA Global Research Academy said in a note.

Domestic Q2 FY'23 GDP print, April-October fiscal deficit and October core sector data are scheduled to be released later in the day.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.15 per cent to 106.65.

Brent crude futures, the global oil benchmark, advanced 1.14 per cent to USD 83.98 per barrel.

In the domestic equity market, the 30-share BSE Sensex was trading 111.56 points or 0.18 per cent higher at 62,793.40 points. Similarly, the broader NSE Nifty rose 36.30 points or 0.19 per cent to 18,654.35 points.

Foreign Institutional Investors (FIIs) were net buyers on Tuesday as they bought shares worth Rs 1,241.57 crore, according to exchange data.