The rupee depreciated 20 paise to 82.71 against the US dollar in early trade on Tuesday due to unabated foreign fund outflows from domestic capital markets.
However, a positive trend in equity markets and a weak dollar overseas capped the rupee's fall, forex traders said.
Investors remained in risk-off mode ahead of the US inflation data release and Federal Reserve decision on interest rates slated to be announced later this week, they added.