On Tuesday the Indian rupee opened little changed at 68.65 versus Monday's close of 68.66, reaching a high and low of 68.61 and 68.70 a dollar, respectively.
Investor sentiment has taken a hit as increased surcharge on super-rich is likely to impact investment by foreign funds in India, leading to flight of foreign funds from the Indian markets, currency traders said.
Dollar traded near a 3-week high against its peers. On Tuesday, the dollar index versus a basket of six leading currencies stood little changed at 97.34.
Oil prices also inched lower after indications that international trade war situation is dragging the global economy. Brent crude futures were down 21 cents, or 0.3 percent, at $63.90 a barrel by 0022 GMT. They fell 12 cents on Monday.
On Monday, FIIs pulled out Rs. 401.99 crore, impacting the rupee trajectory.
In debt markets, the yields on the 10-year government bonds were down 0.1 percent to 6.56 percent from its previous close of 6.56 percent.