The rupee weakened by 3 paise to 64.07 against the US dollar in early trade due to dollar demand from banks and importers.

According to forex dealers said a weak dollar in overseas markets and early gains in stock markets capped the rupee's losses. The dollar was trading lower against the Japanese yen in Asian trade today.

Yesterday, the rupee had lost 55 paise or nearly 1 per cent -- its biggest single-day crash in eight months -- to end at a fresh two-week low of 64.04 against the US dollar, hit by a double whammy of rising global crude prices and worsening trade deficit.

Meanwhile, the benchmark BSE Sensex recovered by 70.65 points or 0.20 per cent to 34,841.70 in early trade.