Rupee depreciated 6 paise to 83.75 against the US dollar in early trade on Monday amid negative equity market sentiment and outflow of foreign funds.

Forex traders said an upward movement in crude oil prices and a strong greenback against major overseas rivals due to its increased demand from importers at the month end put pressure on the local unit.

Also, they said, investors showed muted participation awaiting cues from domestic manufacturing PMI (Purchasing Manager's Index) numbers to be released this week.

At the interbank foreign exchange, the local unit opened at 83.72 and slipped further to 83.75 against the American currency, registering a loss of 6 paise from its previous close.

On Friday, the rupee fell 3 paise to settle at 83.69 against the American currency.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.07 per cent to 100.17.

According to analysts, the dollar strengthened after the US core personal consumption expenditures (PCE) price index for August came in line with market expectations, firming hopes of further interest rate cut by the Federal Reserve.

Brent crude, the international benchmark, advanced 0.71 per cent to 72.49 in futures trade.

On the domestic equity market front, the Sensex declined 353.49 points or 0.41 per cent to 85,218.36, while the Nifty fell 86.75 points or 0.33 per cent to 26,092.20.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday as they offloaded shares worth Rs 1,209.10 crore, according to exchange data.

Analysts said a revival of economic activity in China may prompt foreign investors to withdraw from India and other emerging markets and infuse capital in China.

Except for the headline, this story has not been edited by The Telegraph Online staff and has been published from a syndicated feed.