Forex dealers said increased dollar demand from oil importers mainly put pressure on the local unit.
However, stronger euro against the dollar overseas and a higher opening in the domestic equity market capped the rupee's losses, they added.
Meanwhile, the BSE benchmark Sensex rose by 43.24 points, or 0.23 per cent, to 18,474.09.
The rupee had gained 10 paise to end at 53.98 against the dollar in the previous session on heavy US dollar sales.
