The rupee extended morning losses and dropped 8 paise to 66.20 in against the American currency following sustained bouts of dollar demand from importers and banks amid higher dollar overseas.
The rupee opened lower at 66.16 from last Friday's closing level at 66.12 per dollar at the interbank foreign exchange here.
The domestic unit turned volatile and hovered between 66.23 and 66.14 during morning deals before once again quoting at its opening level of 66.20 at 1130Hrs.
Continued foreign capital outflows from local equities and higher crude oil weighed on the rupee, a dealer said.
Meanwhile, the US dollar traded near a two-week high against a basket of major currencies in early Asian trade, bolstered by rising US bond yields, while easing concerns over global political risks weighed on the safe haven yen.
The 30-share BSE Sensex trading higher by 109.13 points, or 0.32 per cent, at 34,524.71 at 1130Hrs.
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