The rupee started the session on a flat note against the U.S. dollar on Thursday amid strong American currency in the overseas market and a firm trend in the domestic equities.
Besides, unabated foreign fund outflows and fluctuations in international crude prices weighed on investor sentiments, Forex traders said.
At the interbank foreign exchange, the rupee opened slightly strong at 76.28 against the U.S. dollar but soon shed the gains to quote at 76.31, registering a fall of just 1 paisa over the last close.
In the previous session, the rupee rose 20 paise to close at 76.30 against the U.S. dollar.
The dollar index, which gauges the greenback's strength against a basket of six currencies, surged 0.14% to 100.56.
On the domestic equity market front, the 30-share Sensex was trading 381.36 points or 0.67% higher at 57,418.86 points while the broader NSE Nifty advanced 106 points or 0.62% to 17,242.55 points.
Global oil benchmark Brent crude futures rose 1.23% to $108.11 per barrel.
Foreign institutional investors were net sellers in the capital market on Wednesday as they offloaded shares worth ₹3,009.26 crore, as per stock exchange data.