Mumbai:  The rupee on Wednesday fell sharply by 42 paise to 53.54 against the US dollar on the Interbank Foreign Exchange market in early trade on increased capital outflows amid strong demand for the American currency.

Forex dealers said apart from the dollar's gains against the euro and other currencies overseas on renewed euro zone worries, a weak opening in the equity market and increased demand for the American currency from importers mainly put pressure on the rupee.

The rupee had lost 21 paise to close at 53.12 in the previous session. Meanwhile, the BSE benchmark Sensex was down by 86.20 points, or 0.52 percent, at 16,459.98 in early trade.

(Agencies)

Latest news from Business News Desk