The Indian rupee depreciated 4 paise to 74.44 against the US dollar in opening trade on Monday, as investors are awaiting cues from the US Fed's policy decision, due this week. At the interbank foreign exchange, the rupee opened at 74.43 against the dollar, then fell further to 74.44, registering a fall of 4 paise over its previous close.

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On Friday, the rupee had settled at 74.40 against the US dollar. "As markets brace up for the FED meeting on July 28, all currencies are consolidating in their respective small ranges," said Anil Kumar Bhansali, Head of Treasury, Finrex Treasury Advisors.

USD/INR is expected to keep a range of 74.30 to 74.70 for the day, Bhansali said, adding that "importers to buy cash near the lower end of the range while exporters to sell at the higher end". Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading down 0.05 percent at 92.86.

"Investors will be closely eyed to assess the timing of the next bond taper, especially since labour market data is suggesting that economic recovery may have peaked," Reliance Securities said in a research note. Moreover, other data like durable goods orders and US GDP data for the second quarter could also drive markets, the note added.

Global oil benchmark Brent crude futures fell 0.59 percent to USD 73.66 per barrel. On the domestic equity market front, BSE Sensex was trading 34.98 points or 0.07 percent higher at 53,010.78, while the broader NSE Nifty advanced 14.50 points or 0.09 percent to 15,870.55.

Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 163.31 crore, as per exchange data.