Forex traders said concerns over rising COVID-19 cases and foreign fund outflows also weighed on investors'' sentiment.
At the interbank foreign exchange, the domestic unit opened lower at 74.25 against the dollar, and lost further ground and touched 74.33, registering a fall of 24 paise over its previous close.
On Friday, rupee had closed at 74.09 against the US dollar.
Rupee opened on a week note on global dollar strength and weaker-than-expected performance of BJP in state elections, particularly Bengal, said Abhishek Goenka, Founder and CEO, IFA Global.
Goenka further said that "it is likely to trade a 74.15-74.45 range intraday with an upside bias".
The major trigger point for the markets could be the CPI and IIP numbers this week, Reliance Securities said in a research note adding that volumes could be low this week as Chinese investors and traders will be away from the markets on account of Labour Day break from May 3 to 5 this week.
The 30-share BSE Sensex was trading 363.46 points or 0.75 per cent lower at 48,418.90. Similarly, the broader NSE Nifty slipped 85.15 points or 0.58 per cent to 14,545.95.
The daily COVID-19 cases in India showed a slight dip with 3,68,147 new coronavirus infections being reported in a day, taking the total tally of cases to 1,99,25,604, according to the Union Health Ministry data updated on Monday.
Foreign institutional investors (FIIs) remained net sellers in the capital markets, as they pulled out Rs 3,465.07 crore on Friday, as per provisional data.
The dollar index, which gauges the greenback''s strength against a basket of six currencies, was trading higher by 0.06 per cent at 91.33.
Brent crude futures, the global oil benchmark, was down by 0.45 per cent to USD 66.46 per barrel.