The rupee fell by 11 paise to end at 65.06 against the US dollar on Thursday on fresh demand for the American currency from banks and importers amidst a decline in equity markets.
The local currency opened lower at 65.14 as against Wednesday’s closing level of 64.95 at the Interbank Foreign Exchange (Forex) market on initial dollar demand.
It hovered in a range of 65.18 and 65.03 during the day before settling lower by 11 paise, or 0.17%, at 65.06.
The domestic currency had gained 46 paise or 0.70% on Wednesday.
The dollar index was traded down by 0.37% against a basket of six currencies.
In New York, the dollar strengthened against the yen on Wednesday after the Bank of Japan left its programme of asset purchases unchanged at the close of its two-day policy meet.
However, the dollar was moderately lower against the yen in directionless Asian trade on Thursday, with a weaker Nikkei Stock Average prompting buying of the Japanese currency.
Japanese core machinery orders fell at a faster pace than expected for the third straight sequential decline amid concerns over an economic slowdown in China.
Meanwhile, the benchmark BSE Sensex ended lower by 190.04 points, or 0.70%, at 26,845.81.