Continuing its weakness, the rupee breached the 64 per dollar mark to hit its lowest in 20 months on Thursday. It last traded around these levels in September, 2013.
Meanwhile, BSE Sensex and Nifty fell for a third straight session on Thursday, heading towards their lowest close in nearly five months on continued selling by foreign investors on worries over retrospective tax, while weak Asian markets also weighed.
Sustained dollar demand from importers and banks kept pressure on the Indian unit, forex dealers said.
Surge in crude oil prices globally too weighed on the rupee, however, dollar’s weakness overseas, capped losses in the local unit, they said.
Persistent foreign funds outflows, weighed down by lingering concerns over MAT and delay in passage of key tax reform bills in Parliament, dragged down the rupee to 20-month lows.
The rupee opened lower at 63.75 as against last closing level of 63.54 at the Interbank Foreign Exchange (Forex) market, later it slid further to breach 64-level to trade at 64.25 at mid-session, showing a significant fall of 71 paise.
Meanwhile, brent prices fell 56 cents to USD 67.21 in early Asian trade after hitting 2015-high in the previous session.
Meanwhile, the BSE Sensex was trading 189.09 points or 0.71 per cent down at 26,528.28 at 1415 hrs.
The benchmark BSE Sensex rebounded from its early losses in late morning trade to rise by 98 points led by buying in technology, auto and realty sectors.
However, the broader markets remained under pressure with the BSE midcap and smallcap indices falling on the back of lower overseas cues.
The 30-share index resumed slightly higher by 26,721.34 and hovered in a range of 26,850.37 and 26,570.56 before quoting 26,815.23 at 1035 hrs, showing a rise of 97.86 points or 0.37 per cent from its last close.
The NSE Nifty was also quoted higher by 15 points or 0.19 per cent to 8,112.00 at 1035 hrs.
Major gainer were TCS with a rise of 2.73 per cent, Bajaj Auto 2.43 per cent, Infosys 2.21 per cent, Bharti Airtel 1.81 per cent, Hero MotoCorp 1.25 per cent and BHEL 1.07 per cent.
However, Hindalco fell by 2.98 per cent, followed by RIL by 1.01 per cent, ICICI Bank 0.87 and GAIL 0.85 per cent.
Foreign portfolio investors sold shares worth Rs 1,699.60 crore and Domestic institutional investors bought shares worth Rs 1,454.97 crore yesterday, as per provisional data.
Overseas, Asian stocks edged lower in early trade, taking the lead from overnight losses in US stocks. Key indices in China, Hong Kong, Singapore, Taiwan, Indonesia, Japan and South Korea shed between 0.18 per cent and 1.41 per cent.
In the New York, US stocks ended lower yesterday, after US Federal Reserve Chairwoman Janet Yellen warned of high share valuations, adding to anxiety about future interest rates
PTI