On Thursday, the rupee had closed at 75.15 against the US dollar.
The rupee on Friday closed 24 paise lower at 75.39 (provisional) against the US currency on fears of aggressive rate hike by the Federal Reserve after US inflation hit a 40-year high in January.
Forex traders said softening in domestic equities, sustained outflow of foreign funds and higher crude oil prices weighed on the local unit.
At the interbank forex, the rupee opened at 75.40 against the US dollar, and later saw an intra-day high of 75.27 and a low of 75.46 against the greenback.
The local unit finally ended the day at 75.39, which is 24 paise lower than the previous close.
The rupee on Thursday closed at 75.15 against the US dollar after the Reserve Bank of India kept the benchmark lending rate unchanged and said it would continue with an accommodative stance.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.35% higher at 95.88.
Dilip Parmar, Research Analyst, HDFC Securities, said the rupee became the worst-performing currency among Asian peers following policy divergence, broader dollar strengthening, risk-averse sentiments and foreign fund outflows from equities.
Rising expectations of a 50 bps hike by the US Fed in March after four decades of high inflation print undermined risk appetite and gave the dollar the desired push, Mr Parmar said.
Consumer prices in the US rose 7.5% in January from a year earlier, the biggest year-on-year increase since February 1982.
On the domestic equity market front, the 30-share Sensex closed 773.11 points or 1.31% lower at 58,152.92, while the broader NSE Nifty closed 231.10 points or 1.31% lower at 17,374.75.
Global oil benchmark Brent crude futures rose 0.45% to $91.82 a barrel.
Foreign institutional investors remained net sellers in the capital market on Thursday as they sold shares worth Rs 1,732.58 crore, according to stock exchange data.
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