It had rallied against the dollar on Friday, tracking robust gains in domestic stocks and global risk assets on optimism major central banks will step in to counter any adverse impact from Sunday's Greek elections.
Hopes the Reserve Bank of India will cut interest rates on Monday to kickstart domestic growth also supported the rupee, since waning confidence on the economy had been a major factor behind last month's falls to a record low by the local unit.
Asian shares too rose on Monday with Tokyo's benchmark Nikkei 225 index up 2.1 per cent, at 8,749.31. Hong Kong's Hang Seng rose 1.8 per cent to 19,578.13. Australia's S&P/ASX200 rose 1.6 per cent to 4,123.30. South Korea's Kospi rose 2.2 per cent at 1,899.49 as relieved investors snapped up South Korean exporters.
In Greek elections Sunday, pro-bailout parties won enough seats to form a joint government. That eased fears of an imminent Greek exit from the 17-nation euro currency union that could have had catastrophic consequences for other ailing European nations, the United States and the entire global economy.
The next two weeks could prove critical if any grand solution to the crisis is to be achieved. The leaders of the world's 20 largest economies gather Monday in Los Cabos, Mexico, for a summit, with Europe sure to be a major point of discussion.
And on June 28 and 29, leaders of the 27 member countries of the European Union will hold perhaps the most important meeting since the body was created two decades ago.
With inputs from Associated Press, Thomson Reuters