The Indian rupee was poised to open higher against the U.S. dollar, tracking a broad pullback on the currency in the lead-up to key U.S. inflation data due later on Tuesday.
The non-deliverable forward market indicated an opening of around 82.60 for the rupee compared with 82.7175 in the previous session.
Intraday position takers were not likely to chase the USD/INR pair lower at open, a spot trader at a Mumbai-based bank said.
The overnight risk of the U.S. data and India's surprise on inflation would mean little follow-through after the open, he added.
India's inflation rate rose to 6.52% in January from 5.72% in the previous month - well above the 5.9% estimate of economists polled by Reuters and breaching the Reserve Bank of India's upper target limit of 6% for the first time since October.
The "big" surprise clouds RBI's outlook, Barclays chief India economist Rahul Bajoria said in a note to clients.
The dollar index inched lower in Asia to 103.20, adding to Monday's pullback.
Asian currencies were mostly higher ahead of data that is expected to show that U.S. inflation had eased.
"Today will be totally dominated by the U.S. CPI release, where the scope for market surprises is high," ING Bank said in a note.
Federal Reserve officials have continued to push their hawkish rhetoric but have to implicitly and explicitly acknowledge more evidence from data must be gathered before debating the size of further tightening, the bank said.
