The rupee Tuesday declined 6 paise to 69.80 against the US dollar in early trade following increased demand for the greenback from importers and banks.
Besides, a strong US dollar against major global currencies and rising crude prices influenced the domestic unit, forex dealers said.
However, a positive start of the equity markets and fresh foreign funds inflows restricted the rupee fall, they added.
At the Interbank Foreign Exchange market, the domestic unit opened slightly down at 69.75 against the dollar, then it fell further to quote at 69.80, down 6 paise over its previous close in early trade.
The rupee had appreciated 49 paise to 69.74 against the US dollar in the previous session.
Most exit polls forecast another term for Prime Minister Narendra Modi. The results of the seven-phase polls will come out Thursday.
The BSE Sensex was trading 205.24 points, or 0.52 per cent, higher at 39,557.91 in early trade. In similar movement, the broader NSE Nifty rose 48.90 points, or 0.41 per cent, to 11,877.15.
Foreign institutional investors (FIIs) emerged as net buyers in the capital markets, putting in Rs 1,734.45 crore on Monday, provisional exchange data showed.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.04 per cent to 97.97.
Meanwhile, brent crude, the global benchmark, surged 0.31 per cent to trade at 72.19 per barrel.