Moody's has changed India's outlook ratings to 'negative' from 'stable.'
Sustained foreign fund inflows supported the rupee though the gains were capped by hardening crude oil prices, traders said.
Weakening of the US dollar vis-a-vis other currencies and easing crude oil prices restricted the fall, forex brokers said.
Forex inflows through Bajaj Finance share sale to qualified institutional investors helped the rupee hold strong, said analysts.
At the interbank foreign exchange market, the rupee opened on a weak note at 70.96 and fell further to trade at 70.98.
A strengthening dollar against other overseas currencies also kept investors on the edge, forex dealers said.
However, strengthening of the greenback vis-a-vis other currencies overseas capped gains for the rupee, forex dealers said.
Easing crude oil prices propped up the local unit, though fresh capital outflows capped the gains, forex traders said.
Forex traders said rupee was trading in a narrow range as market participants remained cautious ahead of the Brexit summit.
The rupee finally settled at 71.07, unchanged from its previous close.