The rupee appreciated by 13 paise to 85.92 against the US dollar in early trading on Wednesday, supported by optimism over a potential resolution to the Israel-Iran conflict and a firm opening in domestic equity markets.

However, the local currency’s upward momentum was capped by a rebound in global crude oil prices—after two straight sessions of decline—and continued foreign institutional investor (FII) outflows, according to forex dealers.

At the interbank foreign exchange market, the rupee opened at 86.00 and strengthened to 85.92, marking a 13-paise gain from its previous close. On Tuesday, the rupee had recorded its sharpest single-day rise in nearly five years, surging 73 paise to close at 86.05 against the dollar.