The rupee today breached the 55-level again and fell sharply by 56 paise, or over 1%, to 55.05 against the dollar in early trade, due to increased demand for the American currency from banks and importers amid a weak opening in the equities.
Dealers said besides increased demand for dollar from banks and importers, weak euro in the global markets ahead of the European Central Bank policy meeting, mainly put pressure on the local unit.
The rupee had lost 11 paise to close at 54.49 against the dollar yesterday.
Meanwhile, the BSE benchmark Sensex fell by 36.07 points, or 0.21%, at 17,426.74 in early trade.