The rupee declined by 27 paise to Rs 54.28 against the dollar in early trade today at the Interbank Foreign Exchange market on strengthening of the American currency overseas.
Forex dealers said besides dollar's gains against euro in the overseas markets, a weak opening in the stock market also put pressure on the domestic currency.
The BSE benchmark Sensex fell by 61.35 points, or 0.30%, to 18,480.96 in early trade.
The rupee had gained 29 paise to close at a four-month high of 54.01 against the dollar yesterday on robust capital inflows amid Reserve Bank infusing Rs 17,000 crore into system by way of a cut in Cash Reserve Ratio.
