The rupee was trading lower by 10 paise at 66.98 against the US dollar in early trade today after the American currency gained strength overseas.
Besides, industrial production contracting to four-month low of 0.4 per cent in December too weighed on the rupee.
Forex dealers said increased demand for the US currency from importers and dollar's gain against other currencies overseas put pressure on the rupee.
They said, however, a higher opening in the domestic equity market capped the losses.
On Friday, the rupee had ended marginally lower by 3 paise at 66.88 against the dollar because of stray demand coming in from importers and banks for the American currency.
Meanwhile, the benchmark BSE Sensex surged by 124.55 points, or 0.43 per cent, to 28,458.80 in the opening trade today.
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