The rupee dropped to its lowest in nearly two weeks on Thursday as demand for dollars, particularly from oil refiners, picked up momentum for import payments.
The U.S. unit's gains versus major currencies also added to the downward pressure on the rupee.
At 9:45 a.m. (0415 GMT), the partially convertible rupee was at 48.00/01 per dollar, off an early low of 48.10, its weakest since May 18, but 0.6 percent below its previous close of 47.70/71.
"The euro is weaker compared to the dollar, which is pressuring the rupee, and there is also some month-end dollar demand seen in the market," a senior dealer with a foreign bank said, predicting a 47.90 to 48.30 range for the day.
The dollar held steady against the euro on Thursday, having pulled up from five-month lows hit against the single European currency last week due to short-covering.
The dollar index, a gauge of the U.S. unit's performance against majors, was up 0.3 percent.
Dealers said they would be watching domestic shares for cues on direction of fund flows. The Nifty stocks futures traded in Singapore were down 0.1 percent.
Indian shares is expected to open lower, tracking weak Asian markets and as lingering global economic worries prompt profit-taking on a three-quarters rally since early March.
Foreigners have picked up $3.6 billion rupees worth of Indian shares in 2009 and this has been a key factor for the rupee's 8.7 percent rebound from early March record low of 52.2.
