The rupee declined 11 paise to 76.35 against the US dollar in the opening trade on Monday following a negative trend in domestic equities amid concerns over fresh foreign capital outflows.
A strengthening US dollar in the overseas market also affected market sentiment, forex traders said.
At the interbank foreign exchange, the rupee opened sharply lower at 76.36 against the US dollar and was moving in a tight range. Later, it rose slightly to quote 76.35, a fall of 11 paise from the previous close.
In the previous session, the rupee had settled at 76.24 against the US dollar.
Global oil benchmark Brent crude futures slipped 2.50 per cent to $117.63 per barrel.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, surged 0.31 per cent to 99.12.
On the domestic equity market front, the 30-share Sensex was trading 444.32 points or 0.77 per cent lower at 56,917.88, while the broader NSE Nifty slipped 123.65 points, or 0.72 per cent, to 17,029.35.
Foreign institutional investors remained net sellers in the capital market on Friday as they sold shares worth Rs 1,507.37 crore, according to stock exchange data.
Overseas investors have pulled out a net Rs 1,14,855.97 crore from the Indian markets in the current year so far, amid heightened geopolitical tensions and inflation concerns.
Foreign portfolio investors have sold domestic equities worth Rs 48,261.65 crore so far this month, taking the year-to-date tally this year to a massive Rs 1,14,855.97 crore, according to depositories data.