The rupee was trading at 59.20/21, after touching 59.1650, its weakest since July 17, and down from its close of 59.76/77 on Tuesday on the back of central bank measures to boost the local currency by tightening liquidity.
The Reserve Bank of India took new steps to support the rupee, by further reducing banks' access to funds, signalling it will stay the course with its defence of the currency despite risks to economic growth.
"The RBI measures having an impact. Foreign banks seen selling dollars to buy costlier rupees now, but 59.20 is a key support. If broken significantly we can see 58.80 today," a senior state-run bank trader says.
However, traders say state-run banks continue to buy dollars with importer demand staying strong.
