The rupee weakened to 63.88 in the evening trade on heavy capital outflows from the equity market besides dollar's strength against other currencies overseas.
The Sensex and the Nifty gave up early gains and ended nearly half a per cent lower, marking their biggest single-day loss in two weeks, after a government official fanned doubts that the Goods and Service Tax (GST) Bill was unlikely to be cleared in the current session of Parliament.
The 30-share BSE index Sensex was down 134.67 points or 0.48 per cent at 28,101.72 and the 50-share NSE index Nifty was down 39 points or 0.46 per cent at 8,525.60.
The dollar stayed close to a nearly four-month high against a basket of currencies in Asian trade on Monday, after solid US jobs data backed expectations that the US Federal Reserve could raise interest rates as early as September.
The domestic unit opened strong by 4 paise at 63.77 on dollar selling by banks and exporters. Later, it weakened to 63.89, before being quoted at 63.88 at 4.10 pm local time.
The local currency moved in a range of 63.89 and 63.73 in the evening trade.
The rupee had shed four paise at 63.81 against the US dollar in Friday’s trade on sustained demand for the American currency from banks and importers.