The rupee fell by 11 paise to Rs 52.97 per US dollar in early trade on the Interbank Foreign Exchange on Tuesday amid increased demand for the American currency from importers and strengthening of the dollar against the euro overseas.
However, a higher opening in the equity market capped the rupee losses.
Dealers said apart from dollar gains against the euro -- which dipped to a 11-month low amid a debt crisis in the common currency region -- increased demand for the dollar from importers mainly weighed on the rupee sentiment.
However, a higher opening in the equity market limited the losses.
The rupee had lost 16 paise to close at Rs 52.86/87 against the US dollar in the previous session due to fresh demand for the American currency from importers amid weak stock markets.
The BSE benchmark Sensex recovered by 68.79 points, or 0.44%, to 15,448.13 in opening trade on Tuesday.