The rupee weakened by 26 paise to 71.45 against the US dollar in early trade Monday on increased demand for the American currency from importers amid rising crude prices and foreign fund outflows.

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At the interbank forex exchange, the rupee opened lower at 71.38 and weakened further to quote 26 paise down at Rs 71.45 against the dollar.

Forex dealers said the dollar's gains against some other currencies overseas too weighed on the rupee sentiment.

However, a positive opening of the domestic equity market capped the rupee's losses, they said.

Brent crude, the international oil benchmark, was trading 0.46 per cent higher at USD 62.99 per dollar, its two-month high.

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On Friday, the rupee had shed 16 paise to end at 71.19 against the dollar.

Meanwhile, the benchmark BSE Sensex rose 32.76 points, to 32,419.37 in opening session Monday.