The Indian rupee has recorded a rise of 0.4 per cent to 52.7850/7900 against the US dollar as the foreign investors invested in local debt.

The partially convertible rupee had closed at 52.98/99 on Tuesday. According to foreign exchange traders, the foreign institutional investors (FIIs) were buying Indian debt which brought additional dollars to the economy and strengthened the rupee.

The dealer said that these flows are supporting the rupee’s valuation. The Securities Exchange Board of India had in November auctioned the enhanced debt limit for foreign funds and received a positive response from the market.

Exporters and banks have been selling dollars, which has been struggling against the dollar. The Indian rupee has emerged as the worst performing currency in Asia in recent times.

Domestic shares opened down 0.5% as investors due to quarterly earnings expected this month as well as due to the continuing crisis in the eurozone. Traders say that the Indian currency has a bllek outlook in the short term.

The most-traded near-month dollar-rupee contracts at the National Stock Exchange, the MCX-SX and the United Stock Exchange were trading at the level of 52.97.