The Indian rupee strengthened 14 paise to 95.85 against the US dollar in early trading on Friday, supported by gains in domestic equity markets. The currency continued to hold above the key 96-per-dollar level.

Forex dealers said the rupee remained under pressure from strong dollar demand from importers, particularly oil companies, along with elevated crude oil prices. A firmer US dollar index, following hawkish signals from the Federal Reserve on interest rates, also weighed on the domestic currency.

Market participants expect the Reserve Bank of India (RBI) to step in if required to contain excessive volatility in the foreign exchange market.