The rupee pared morning losses and was trading 1 paisa higher to 68 against the American currency in late morning deals amid bouts of dollar-selling by banks and exporters, despite strength in the greenback.

The rupee hit a fresh three-week low of 68.16 against last Friday’s closing level of 68.01 at the inter-bank foreign exchange in Mumbai.

Some dollar-selling by banks on behalf of the apex bank curbed the fall in rupee, a dealer said.

Meanwhile, the US dollar rose towards a seven-month high against its major peers in early Asian trade as investors hoped the United States and China would avoid a full-blown trade war, although tensions between the two slowed its gains.