The Indian rupee opened on a cautious note and fell 7 paise to 70.63 against the US dollar in early trade on Monday tracking weak opening in domestic equities and foreign fund outflows. Forex traders said increasing demand for the US dollar vis-a-vis other currencies overseas and rising crude oil prices weighed on the domestic unit.
At the interbank foreign exchange, the rupee opened on a strong note at 70.37 then lost momentum and fell to 70.63 against the US dollar, showing a decline of 7 paise over its previous closing. The Indian rupee on Friday had closed at 70.56 against the US dollar.
Domestic bourses opened on a negative note on Monday with benchmark indices Sensex trading 255.85 points down at 38,566.72 and Nifty lower by 83.20 points at 11,429.20.
Foreign institutional investors (FIIs) offloaded shares worth Rs 213.60 crore on Friday, according to provisional exchange data. The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.03 per cent to 99.13.
Forex traders said rising crude oil prices weighed on the rupee. Crude oil benchmark, Brent Futures, rose 0.05 per cent to USD 61.94 per barrel. Meanwhile, the 10-year government bond yield was at 6.70 per cent in morning trade.
On the global front, China will send its top trade negotiator to US for trade talks. China's top trade negotiator will lead an upcoming trade talks with the United States, a senior Chinese official said Sunday.