The rupee depreciated 10 paise to 81.69 against the US dollar in early trade on Monday, weighed down by significant foreign fund outflows.
At the interbank foreign exchange, the domestic unit opened weak at 81.69 against the dollar, registering a decline of 10 paise over its last close.
In the previous session on Friday, the rupee settled at 81.59 against the dollar.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.01 per cent to 101.92.
Brent crude futures fell 0.17 percent to USD 86.51 per barrel, the global oil benchmark.
The focus on the Union Budget and the US Federal Reserve's policy decision will dictate the course for the local unit on Monday, traders said.
India's foreign exchange reserves climbed by USD 1.727 billion to USD 573.727 billion in the week ending January 20, the Reserve Bank of India (RBI) reported on Friday. The kitty has increased for the second week in a row.
The 30-share BSE Sensex was trading 30.72 points, or 0.05 percent, higher at 59,361.62 on the domestic equity market.
The NSE Nifty index as a whole increased 17.55 points, or 0.1 percent, to 17,621.90.
According to exchange statistics, Foreign Institutional Investors (FIIs) changed from buyers to sellers in the capital markets on Friday as they sold shares worth Rs 5,977.86 crore. This occurred during a decline in Indian equities caused by a selloff led by the Adani Group.
With inputs from Agencies.
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