The rupee on Tuesday depreciated by 23 paise against the greenback in early trade as the dollar strengthened against some regional currencies and Asian stock markets opened weak.
At the Interbank Foreign Exchange (Forex) market, the domestic currency traded lower at 48.93 against the US currency, a fall of 23 paise over the previous close of 48.70/71 a dollar.
The rupee had gained 9 paise at 48.70/71 against US$ in volatile trade Monday.
Dealers said fears of capital outflows as domestic stock markets were expected to open sharply lower in line with weak trends in other Asian bourses in early trade and increased dollar demand from importers mainly put pressure on the rupee.
They said the dollar's rise against other regional currencies also had negative impact.
Meanwhile, Japan's Nikkei fell by 2.95 per cent, while Hong Kong's Hang Seng shed 3.10 per cent in early trade.