At the interbank foreign exchange, the domestic unit opened at 82.23. It finally settled at 82.23 (provisional) against the American currency, registering a fall of 5 paise against its previous close.
During intra-day, the Indian unit touched the peak of 82.21 and hit the lowest level of 82.29 against the dollar.
On Friday, the rupee had settled at 82.18 against the dollar.
Traders were also upbeat on the dollar following positive macroeconomic data from the US and robust sentiment in the global markets.
According to Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, the rupee declined on the strong US dollar and elevated crude oil prices.
"WTI crude oil prices breached the
"We expect the rupee to trade with a negative bias on the strong dollar and some felling by FIIs over the past couple of sessions. However, improved global risk appetite may support the rupee at lower levels," Choudhary said.
Choudhary said participants may take cues from India's fiscal deficit data expected to be released on Monday and PMI data later this week.
"Investors may remain cautious ahead of PMI data and jobs reports from the US this week. We expect the USD/INR spot to trade in the range of 81.80 to 82.80 in the near term," he added.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.07 per cent to 101.70.
Brent crude futures, the global oil benchmark, were trading 0.41 per cent higher at USD 85.34 per barrel.
In the domestic equity market, the 30-share BSE Sensex closed 367.47 points or 0.56 per cent higher at 66,527.67. The broader NSE Nifty advanced 107.75 points or 0.55 per cent to 19,753.80.
Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday as they offloaded shares worth Rs 1,023.91 crore, according to exchange data.