The Indian rupee strengthened by 26 paise to hit a four-month high of 47.25 against the US currency in opening trade on Tuesday on increased dollar selling by exporters amid expectations of fresh capital inflows by foreign funds.

The dollar's weakness against major currencies also supported the Indian rupee. At the Interbank Foreign Exchange (Forex) market, the domestic unit gained 26 paise to quote at 47.25 a dollar, a level not seen since June 5.