The rupee weakened on Monday as shares fell to their lowest close in 2 and a half weeks on worries about whether foreign investors will continue to buy into India in the new year, but exporters sold dollars, capping broader losses.

The rupee has fallen 0.8% so far this year, hitting a one-month low on Friday, hurt by a stronger dollar globally as well as caution ahead of key economic data this month.

Some traders speculated the central bank likely sold a small amount of dollars at the session high of 62.46 per dollar levels, prompting exporters to rush in to sell. However, there was no clear consensus in the market.

The rupee is expected to be rangebound, with the government due to post November factory output on Friday, which will be followed by December wholesale and retail price data next week.

“We should see the pair hold in a 61.75 to 63.00 range in the near-term,” said Paresh Nayar, head of fixed income and currencies at First Rand Bank.

“Forward premiums are still high. So exporters also were likely selling the greenback,” he added.

The partially convertible rupee closed at 62.31 per dollar compared with 62.16 on Friday after moving in a range of 62.24 to 62.46 during the session.

The rupee weakened as Indian shares fell to their lowest close in two and a half weeks on Monday, and have now declined in each of the four trading sessions of the year.

Foreign funds sold a net $2.22 million on Friday, latest exchange data showed, sparking worries about whether the strong buying seen last year would ease.

Foreign institutional investors are still net buyers of $160.21 million so far in 2014 after buying more than $20 billion in 2013.

In the offshore non-deliverable forwards, the one-month contract was at 62.78 while the three-month was at 63.64.

The one-month onshore forward premium rose to 45.50 points compared with 42.50 points at previous close while the three-month was at 132.50 points versus 130.25 points on Friday