The rupee declined by 8 paise to 53.55 against the dollar in early trade on the Interbank Foreign Exchange today following increased month-end demand for the American currency from importers.
Dollar's gains against euro in the overseas markets amid the increasing threat for another debt-restructuring in Greece also put pressure on the local unit, forex dealers said.
A higher opening in the stock market, however, restricted the rupee's losses, they added.
The BSE benchmark Sensex recovered by 116.67 points, or 0.62%, to 18,790.01 as power sector stocks rose after the government cleared proposal to restructure debt worth nearly Rs 2 lakh crore for state electricity boards.
The rupee had lost 2 paise to end at 53.47 against the dollar in yesterday's session on heavy month-end dollar demand from importers and weakness in equities.
