Forex dealers said besides dollar's gains in the overseas markets, outflow of foreign funds from weakening domestic equity market further influenced the rupee sentiment.
The rupee had gained 36 paise to close at 55.12 against the US dollar in yesterday's trade on sustained capital inflows amid exporters selling the US currency.
Meanwhile, the BSE benchmark Sensex fell by 27.52 points, or 0.16 per cent, at 17,251.33.