The rupee had recovered by 7 paise to close at 70.44 against the US dollar on Tuesday.

The rupee appreciated by 23 paise to 70.21 against the US dollar in opening trade Wednesday, driven by easing crude prices, a higher opening in domestic equities and hopes about easing US-China trade tensions.

Forex dealers said that investor sentiment was buoyed after US President Donald Trump on Tuesday hoped that the world's top two economies would be able reach an agreement.

The rupee opened strong at 70.32 at the interbank forex market then gained further ground and touched 70.21 amid a positive opening in domestic equities, displaying gains of 23 paise over its last close.

The rupee had recovered by 7 paise to close at 70.44 against the US dollar on Tuesday.

"I think it's going to turn out extremely well, we''re in a very strong position," Mr Trump said.

He also described his relationship with President Xi Jinping of China as "extraordinary".

"We have a very good dialogue... it'll always continue. We had a deal that was very close and then they broke it," he said.

Meanwhile, foreign fund outflows weighed on the domestic currency and restricted the upmove.

Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 2,011.85 crore on a net basis Tuesday, provisional exchange data showed.

Brent crude futures, the global oil benchmark, eased 0.31 per cent to $71.02 per barrel.

Meanwhile, the benchmark BSE Sensex was trading higher by 87.83 points, or 0.24 per cent to quote at 37,410.15 while the NSE Nifty was trading at 11,245.00, down by 22.95 points, or 0.20 per cent.