The Indian rupee on Friday depreciated by four paise at 46.69 against the US dollar in early trade largely on fears of fresh capital outflows by foreign funds as market may open lower on weak Asian cues.
The US unit's gains against other major currencies also put some pressure on rupee sentiment.
At the Interbank Foreign Exchange (Forex) market, the domestic unit traded four paise down at 46.69 a dollar. The rupee ended 35 paise lower at 46.65/66 against the dollar in the previous session after the Sensex ended 153.57 points down.
Forex dealers said fears of more capital outflows by foreign funds as markets have a weak opening in tandem with their Asian counterparts, which were trading in the negative zone, and dollar's gains against other currencies mainly put pressure on the Indian rupee.
Japan's benchmark Nikkei-225 index was trading 31.88 points lower at 9,772.61 in morning session.