Rupee depreciated 11 paise to settle at 83.80 (provisional) against the US dollar on Monday, taking cues from equity markets that saw a steep fall of over 1 per cent amid volatile crude oil prices and outflow of foreign funds.

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However, a weak greenback against major currencies supported the local unit, forex traders said, while investors showed muted participation awaiting cues from domestic macroeconomic data to be released this week.

At the same time, they said, monetary and fiscal stimulus announced by China triggered withdrawal of foreign funds as investors preferred better-performing Chinese markets.

At the interbank foreign exchange, the local unit opened at 83.72 and hit the intra-day low of 83.81 against the greenback during the session. The unit finally settled at 83.80 (provisional) against dollar, registering a loss of 11 paise from its previous closing level.

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

Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, said the rupee declined on weak domestic markets.

"Weaker than expected core personal consumption expenditures (PCE) price index and personal income data from the US also weighed on the dollar and raised optimism on rate cuts by the Fed," he said, adding that rupee is expected to trade with a slight negative bias amid volatile crude oil prices on the back of the escalation of geopolitical tensions in the Middle East.

"Traders may take cues from India's fiscal deficit and current account deficit data. Investors may watch out for ISM manufacturing PMI and non-farm payrolls report from the US this week. USD-INR spot price is expected to trade in a range of Rs 83.60 to Rs 84," Choudhary said.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.12 per cent to 99.99.

According to analysts, the US core PCE price index for August showed a lower-than-expected rise, firming hopes of further interest rate cut by the Federal Reserve.

Brent crude, the international benchmark, declined 0.24 per cent to 71.81 in futures trade.

On the domestic equity market front, the Sensex tumbled 1,272.07 points or 1.49 per cent to settle at 84,299.78, while the Nifty tanked 368.10 points or 1.41 per cent to close the session at 25,810.85.

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

Meanwhile, India's forex reserves jumped by USD 2.838 billion to a new all-time high of USD 692.296 billion for the week ended September 20, the RBI said on Friday. The overall kitty had increased by USD 223 million to a new high of USD 689.458 billion for the previous reporting week.