Besides, dollar's gains against its rivals overseas also weakened sentiment locally.
However, a higher opening in the domestic equity market capped the losses to some extent.
Yesterday, the rupee had ended 10 paise up at nearly three-week high of 64.33 against the dollar after the Reserve Bank lowered its inflation forecast while keeping the policy rates unchanged.
Meanwhile, the benchmark Sensex rose 83.23 points, or 0.26 per cent, to 31,354.51 in early trade.