Mumbai: The rupee declined 9 paise to 65.10 against the dollar on Thursday after economic data showed the US economy in a more positive light.

Fresh demand for the American currency came in from importers and banks.

Traders said the dollar's renewed strength against other currencies overseas weighed on the rupee, but a higher opening in domestic equities limited the impact.

According to latest data points, the US economy is seen to be gradually gaining traction.

On Wednesday, the rupee had made a smart comeback to end up 49 paise, or 0.75 per cent, at a fresh one-week high of 65.01, with investors taking a bullish stance on the economy even as the RBI kept key rates unchanged.

Meanwhile, the benchmark BSE Sensex rose 77.58 points, or 0.24 per cent, to 31,749.29 in early session.