The Indian rupee is extending sharp gains against the dollar for the third straight session tracking deepening loses in the greenback overseas. Easing international oil prices and foreign investment inflows are also seen supporting the counter. Moreover, domestic macroeconomic data showed India's consumer price inflation eased further in March to the lowest level in more than five-and-a-half years amid slower rise in food prices. Consumer price inflation eased more-than-expected to 3.34 percent in March from 3.61 percent in February, boosting rate cut bets. Similarly, India's wholesale price inflation eased further in March to the lowest level in four months, according to provisional data from the Ministry of Commerce and Industry. The wholesale price index, or WPI, rose 2.05 percent year-over-year in March, following a 2.38 percent increase in February. Benchmark indexes Sensex and Nifty also jumped over 2 percent each on Tuesday following temporary U.S. tariff reliefs on electronics and auto-related imports. INR opened at Rs 85.66 per dollar and hit a low of 85.55 so far during the day.

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