The rupee resumed lower at 60.28 per dollar as against the previous closing of 60.03 at the Interbank Foreign Exchange market and dropped further to 60.32 on initial demand for the American unit from banks and importers.
However, it trimmed its initial losses and was quoted at 60.16 per dollar at 1000 hours.
It moved in a range of 60.14 and 60.32 per dollar during the morning trade.
In New York market, the dollar rose against the pound, the first gain in five sessions, after weaker-than-expected UK inflation raised questions about the Bank of England's need to increase interest rates, which tends to weigh on price pressures.
Meanwhile, the benchmark BSE Sensex moved up by 39.71 points, or 0.16 per cent, to 25,560.90 at 1000 hours.