Mumbai: The rupee declined 9 paise to 65.10 against the dollar in early trade Thursday after economic data showed the US economy in a more positive light.
Fresh demand for the American currency came in from importers and banks.
Traders said the dollar's renewed strength against other currencies overseas weighed on the rupee, but a higher opening in domestic equities limited the impact.
According to latest data points, the US economy is seen to be gradually gaining traction.
Yesterday, the rupee had made a smart comeback to end up 49 paise, or 0.75 percent, at a fresh one-week high of 65.01, with investors taking a bullish stance on the economy even as the RBI kept key rates unchanged.
Meanwhile, the benchmark BSE Sensex rose 77.58 points, or 0.24 percent, to 31,749.29 in early session.