The Indian rupee is seen recovering some of its lost ground in opening trades on Friday as dollar stays in a bearish mode. Yesterday, rupee depreciated 20 paise to close at 86.61 against the US dollar, dragged down by a strong American currency overseas, elevated crude oil prices and foreign fund outflows. However, positive domestic equity markets provided some cushion at the lower level. The benchmark S&P BSE Sensex edged up by 318.74 points, or 0.42 percent, to 77,042.82 while the broader NSE Nifty index closed up 98.60 points, or 0.42 percent, at 23,311.80. Meanwhile, the Reserve Bank of India (RBI) on Thursday announced liberalised norms to encourage use of Indian Rupee and local/ national currencies to settle cross border transactions. The decision comes at a time when the domestic currency is sliding and touched an all-time low of 86.70 per US dollar on Monday. The Reserve Bank has already signed Memorandum of Understanding (MoU) with the central banks of the United Arab Emirates, Indonesia and Maldives to encourage cross-border transactions in local currencies, including Indian Rupee.

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