The rupee depreciated by 7 paise to 66.62 against the dollar in early trade on Friday due to sustained foreign fund outflows amid appreciation in the US currency overseas.

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Dealers also attributed the fall to fresh demand for the US currency from importers and banks and a lower opening of the domestic equity market.

On Thursday, the rupee ended steady at 66.55 on mild selling of the dollars by banks and exporters in view of recovery in the domestic equity market.

Meanwhile, the benchmark BSE Sensex fell 160.09 points, or 0.63%, to 25,102.12 in early trade.