Heavy selling in domestic equities weighed on the local unit and restricted the upmove.
Mumbai: The Indian rupee appreciated by 8 paise to 71.32 against the US dollar in early trade on Monday amid easing crude oil prices and weakening of the American dollar in the overseas market.
Forex traders said while weak dollar and easing crude oil prices supported the rupee, heavy selling in domestic equities weighed on the local unit and restricted the upmove.
At the interbank foreign exchange the rupee opened at 71.36, than gained further ground and touched a high of 71.32 against the US dollar, registering a rise of 8 paise over its previous close. On Friday, rupee had settled for the day at 71.40 against the US dollar.
Domestic bourses opened on a negative note on Monday with benchmark indices Sensex trading 226.26 points down at 40,915.59 and Nifty down 71.85 points at 12,026.50.
Foreign institutional investors (FIIs) remained net buyers in the capital market, as they purchased shares worth Rs 161.93 crore on Friday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, fell 0.20 per cent to trade at USD 54.36 per barrel.
The dollar index, which gauges the greenback's strength against a basket of six currencies, fell by 0.04 per cent to 98.64.
The 10-year government bond yield was at 6.43 per cent in morning trade.