At the interbank foreign exchange, the domestic unit opened at 74.46 against the dollar, then inched higher to 74.40, registering a gain of 21 paise over its previous close.
On Tuesday, the local unit ended 27 paise higher at 74.61 against the US dollar.
Domestic stocks markets and currency markets were shut on Wednesday, 21 July 2021 for Bakri-Id.
The dollar index, which measures the currency against six major peers, stood at 92.810 after pulling back from a 3 1/2-month high of 93.194 touched on Wednesday.
On the domestic equity market front, BSE Sensex was trading 575 points higher at 52,773.83, while the broader NSE Nifty advanced 167 points to 15,799.75.
Besides, foreign institutional investors were net sellers in the capital market on Tuesday as they offloaded shares worth Rs 2,834.96 crore, as per exchange data.
Meanwhile, Asian stocks are trading higher on Thursday after solid company earnings boosted Wall Street, easing concerns about peak economic growth and coronavirus flare-ups. Wall Street stocks posted their second-straight daily gain on Wednesday, with robust corporate earnings and renewed optimism about the U.S. economic recovery fueling a risk-on rally.