The Indian rupee was down by 18 paise at Rs 46.16 per US dollar in early trade today on persistent dollar demand from banks and importers amid weak domestic equity markets and strengthening of the American currency overseas.
The rupee resumed lower at Rs 46.11/12 per US dollar on the Interbank Foreign Exchange, as against its previous close of Rs 45.98/99 per dollar, and moved down further to Rs 46.16 per dollar before quoting at Rs 46.09/10 per dollar at 1030 hours.
The domestic currency hovered in a range between Rs 46.00 and Rs 46.16 per dollar in morning deals.
Sustained dollar demand from banks and importers in view of dollar firmness in overseas markets was the major factor behind the fall in the rupee value against the dollar, a forex dealer said.
The dollar gained against most major rivals in early trade in the Sydney market as Europe's lingering debt problems pushed investors toward investments perceived as less risky.