The rupee recovered from its all-time low level and appreciated 29 paise to 83.32 against the US dollar in early trade on Tuesday.

At the interbank foreign exchange, the domestic currency opened at 83.33 and it gained ground and touched 83.32 against the greenback in initial deals, registering a gain of 29 paise from its previous close.

On Friday, the rupee depreciated 48 paise to settle at an all-time low of 83.61 against the American currency.

Forex, equity markets were closed on Monday on account of Holi.

Market analysts said, for the domestic unit, record forex reserves provide a cushion, enabling the Reserve Bank to mitigate the rupee's downside.

India's forex reserves increased by USD 6.396 billion to USD 642.492 billion for the week ended March 15, the Reserve Bank said on Friday.

In the previous reporting week, the overall reserves had risen by USD 10.47 billion to USD 636.095 billion.

"With RBI accumulating reserves they would endeavour to protect the rupee to some extent though overall their interest would be to protect exporters costing so that exports surge while imports come down and are replaced by indigenous production," said Anil Kumar Bhansali Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell by 0.01 per cent to 103.79.

Brent crude futures, the global oil benchmark, declined 0.07 per cent to USD 86.69 per barrel.

In the domestic equity market, the 30-share BSE Sensex was trading 265.68 points or 0.36 per cent lower at 72,566.26 points. The broader NSE Nifty declined 60.95 points or 0.28 per cent to 22,035.80 points.

Foreign institutional investors (FIIs) were net sellers in the capital markets on Friday as they offloaded shares worth Rs 3,309.76 crore on a net basis, according to exchange data.

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