The rupee weakened to 65.16 due to mild demand for the greenback from importers and banks despite dollar remaining weak overseas.

The US Fed minutes signalled rate hike eventuality despite low inflation levels.

The rupee opened flat at 65.14 at the Interbank Foreign Exchange market today. It later slipped to 65.16 before quoting at 65.13, up 1 paise at 11 am local time.

The domestic unit hovered in a range of 65.16 and 65.09 during morning trade.

“Higher local equities is restricting the rupee volatility,” a forex trader said.

As per provisional data, FPIs withdrew Rs 107.95 crore on a net basis from stock markets yesterday.

Overseas, the US dollar hit a two-week low versus a basket of currencies in early Asian trade after the minutes from suggested that some central bankers are still concerned about persistently low inflation.

Meanwhile, the benchmark BSE Sensex was trading higher by 120.70 points or 0.38 per cent at 31,954.69.