The rupee depreciated 23 paise to 74.98 against the US dollar in opening trade on Friday tracking weak domestic equities and strengthening American currency.
Forex traders said steady crude oil prices and foreign fund inflows supported the rupee, while factors like strong dollar, muted domestic equities and rising COVID-19 cases dragged the local unit down.
The rupee opened on a weak note at 74.94 at the interbank forex market, then lost further ground and touched 74.98 against US dollar, down 23 paise over its last close.
It had settled at 74.75 against the US dollar on Thursday.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.05 per cent to 94.74.
On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 230.96 points lower at 37,909.51 and broader NSE Nifty fell 76.55 points to 11,138.90.
Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 1,740.50 crore on Thursday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 0.39 per cent to USD 43.48 per barrel.
Meanwhile, the number of cases around the world linked to COVID-19 has crossed 1.54 crore and the death toll has topped 6.32 lakh.
In India, the death toll due the disease rose to 30,601 and the number of infections stood at 12,87,945, according to the health ministry.