The Indian rupee is likely to open marginally higher on Wednesday as the dollar retreats in the lead up to U.S. inflation data that will give cues on the direction of U.S. interest rates. The 1-month non-deliverable forward indicated that the rupee will open at 86.

On Wednesday, a strong dollar rally slowed down as traders were a little more cautious. They awaited a crucial U.S. consumer inflation report that was expected later in the day, keeping investors from making their big moves.