A one rupee coin is seen in this picture illustration taken in Mumbai | Photo: Reuters
The rupee depreciated by 5 paise to 68.59 against the US dollar in early trade on Wednesday ahead of the Reserve Bank's monetary policy outcome, scheduled later in the day.
Dealers attributed the rupee's fall to fresh demand for the US currency, but a higher opening in domestic stocks limited the fall.
Major currencies were mostly weak against the dollar overseas after reports that US President Donald Trump would propose tariffs of 25 per cent, instead of 10 per cent, in an announcement that may come as early as today.
Yesterday, the rupee had gained 13 paise to close at a fresh two-week high of 68.54 against the dollar on expectations that the US Fed is likely to keep rates unchanged.
Meanwhile, the benchmark BSE Sensex rose 58.95 points, or 0.15 per cent, to hit an all-time high of 37,665.53. NSE Nifty too scaled a new peak high of 11,378.95 in early trade today.