The Indian rupee strengthened to 85.88 against the US dollar on Wednesday, up 17 paise, tracking firm equities and easing Israel-Iran tensions. Gains were capped by hawkish Fed comments, rising crude prices, and foreign fund outflows. The rupee touched a high of 86.01 and a low of 85.79. FIIs offloaded ₹5,266.01 crore in equities on Tuesday.