The Indian rupee weakened by 5 paise to 66.27 against the dollar at the Interbank Foreign Exchange(forex) market today on fresh demand for the American currency from importers and banks.

Dealers attributed the Indian rupee’s fall to increased demand for the US currency. However, a higher opening in the domestic equity market capped the losses.

The Indian rupee had advanced by 33 paise to close at 66.22 in yesterday’s trade on sustained selling of US dollars by banks and exporters in view of weaker American currency in the overseas market.

Meanwhile, the benchmark BSE Sensex reclaimed the crucial 26,000-level by gaining 219.02 points or 0.85 per cent to 26,063.20 in early trade.