The rupee recovered by 7 paise to 64.95 against the dollar in early trade today on mild selling of the US currency by exporters.
Currency traders said weakness in the dollar against major global currencies overseas supported the rupee.
The rupee had lost 28 paise to close at 65.02 yesterday due to fresh bouts of demand for the greenback amid renewed Fed rate hike fears.
Meanwhile, the benchmark BSE Sensex fell by 100.74 points or 0.31 per cent to 32,508.42, while the NSE Nifty retreated from record by falling 29.30 points, or 0.29 per cent to 10,205.15 in early trade.
Foreign portfolio investors withdrew Rs 484.92 crore on net basis from stock markets yesterday, according to the BSE data.