The Indian rupee opened on a cautious note and fell 9 paise to 71.03 against the US dollar in early trade on Wednesday amid rising demand for the US dollar vis-a-vis other currencies overseas and unabated foreign fund outflows. At the interbank foreign exchange, the rupee opened at 71.01 then fell to 71.03 against the US dollar, showing a decline of 9 paise over its previous closing. The Indian rupee on Tuesday had closed at 70.94 against the US dollar.
Forex traders said trading in emerging market currencies were subdued after the British Prime Minister Boris Johnson lost the crucial Brexit Bill timetable vote. Traders were also awaiting fresh cues on the potential US-China trade deal. US President Donald Trump on Monday had said that the 'phase 1' China trade pact on track for November.
Meanwhile, brent crude futures, the global oil benchmark, fell 0.52 per cent to USD 59.39 per barrel. Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 557.50 crore on Tuesday, as per provisional data.
Domestic bourses opened on a cautious note on Wednesday with benchmark indices Sensex trading 49.35 points down at 38,914.49 and Nifty lower by 7.50 points at 11,580.85.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.05 per cent to 97.57. The 10-year government bond yield was at 6.53 per cent in morning trade.