On Tuesday, the rupee had gained 48 paise to end at a one-month high of 70.70.
The rupee strengthened by 26 paise to 70.44 against the dollar in opening trade on Wednesday after retail inflation fell to a 19-month low of 2.05 per cent in January, reported Press Trust of India (PTI).
The weakness in the dollar against some currencies overseas as investors shifted their focus to riskier assets amid the US-China trade truce hopes, also supported rupee's movement, traders were quoted as saying in the PTI report.
On Tuesday, the rupee had gained 48 paise to end at a one-month high of 70.70 against the dollar.