Snapping a 2-day winning streak, the rupee weakened by 32 paise to quote at 64.17 against the US dollar in the evening trade following a sharp fall in local equities amid fresh dollar demand from importers and some banks.
A weak dollar overseas amid renewed capital inflows, however, restricted the rupee's fall to some extent, a forex dealer said.
The domestic unit opened weak at 64.10 a dollar at the Interbank Foreign Exchange market today from the previous close of 63.85 and moved in a range of 64.11 and 64.26 before being quoted at 64.17 at 4.20 pm local time.
Meanwhile, the Indian benchmark S&P Sensex plunged 630 points after two days of smart rally, while foreign portfolio investors (FPIs) bought shares worth Rs 169.97 crore yesterday, according to provisional data.
The dollar index fell 0.7 per cent against its major global rivals despite renewed worries over a Greek exit from the euro zone.
Market is now waiting for the outcome of the IIP and CPI data to be announced later in the day.