Mumbai: The rupee depreciated by 18 paise to 66.88 against the dollar in early trade today at the Interbank Foreign Exchange market on increased demand for the US currency from importers.
Besides, the dollar held strong against other currencies overseas on rising hopes that the Federal Reserve will hike interest rates later this month.
A lower opening in equities also kept pressure on the domestic unit, dealers said.
Yesterday, the rupee had ended higher by 12 paise at 66.70 against the American currency on fresh bouts of dollar selling amid an overall upbeat sentiment following the release of GDP data.
Meanwhile, the benchmark BSE Sensex fell further by 88.05 points or 0.30 per cent to 28,751.74 in early deals today.