Although the current long-term bullish trend is intact, markets are awaiting clarity on the taper and the Assembly election results.
The rupee on Friday fell by 9 paise to 67.64 per dollar on fresh demand for the American currency.
The rupee had gained five paise to close at 63.25 against the dollar in on Monday's trade on fresh selling of the US currency by exporters amid bullish stocks.
Petrol price was cut by Rs 2.43 per litre and diesel by Rs 3.60 a litre, the third reduction in rates this month.
Rupee gained on increased selling of the US currency by banks and exporters
Pharma was the top losing index amid worries about their earnings outlook with Lupin down over 4%
The NSE Nifty cracked below the 10,800-mark to hit a low of 10,753.05 intra-day, before closing at 10,762.45 with a loss of 59.40 points, or 0.55 per cent.
The rupee had ended almost flat at 61.41 against the Greenback in the previous session on Wednesday on alternate bouts of buying and selling.
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The rupee recovered marginally at close against the dollar.
Despite the possibility of the economy bottoming out, the investment cycle could remain weak for another couple of years and earnings downgrades should continue.
The session was marked by volatility and stock-specific action, even as the overall sentiment remains risk-averse, brokers said.
Forex dealers said increased selling of the American currency by exporters and banks supported the rupee but a lower opening of the domestic equity market and dollar's rise against other currencies overseas restricted the gains.
Both the indices ended at their highest levels since February 1.
The broader NSE Nifty moved between 10,705 and 10,785.55, before ending 25.15 points, or 0.23 per cent down at 10,716.55.
The Indian unit opened sharply higher at 64.80 as against Wednesday's closing level of 65.12.
Rupee was impacted by renewed dollar demand from banks and importers amid sharp falls in equity market
Traders expect the rupee to remain wedged between the 59.60 and 60.50 levels in the absence of any key triggers in the near-term.
Dollar sales by exporters and firm local equities also supported the local currency.
The next 12 months will be quite challenging marked by uncertain political events and evolving macroeconomic scenario
The rupee ended higher for the second consecutive week.
'Demonetisation will push India onto a higher growth path after a temporary dip.'
The rupee is currently hovering around Rs 65/USD at 2-year lows.
The broader NSE Nifty too dived by 101.65 points, or 0.97 per cent, to close at 10,350.15.
Investors are trying to push ahead with dollar purchases, emboldened by improving market sentiments
The price reduction will be effective midnight tonight, announced Indian Oil Corp
The rupee had lost 10 paise to close at 21-month low of 64.26 against the greenback in Tuesday's trade.
The primary aim for the Rohit Sharma-led India against minnows Hong Kong would be to get their combination right before the big game against Pakistan on Wednesday.
The RBI fixed the reference rate for the dollar at 64.1505 and for the euro at 72.2720.
For the first time in India, Swiss Learning, an educational body managed by the Heads of Swiss Educational Institutes, has brought representatives from various schools from the country to meet stakeholders, Indian schools and parents of potential students.
Foreign investors have bought nearly $5 billion worth of debt so far in 2014.
Weakness in the dollar against some currencies supported the rupee.
Increased demand for the dollar from importers affected the value of the rupee
Now candidates can appear for NEET any number of times.
Upstream firms have a tremendous financial pressure due to selling crude at subsidised rates to oil marketing firms.
The rupee was largely rangebound for most of the trading day in the absence of any major cues ahead of the Reserve Bank of India's rate-setting meeting next week.
The rupee on Tuesday weakened by 15 paise to close at 63.30 against the US currency
The rupee has dropped by 21 paise or 0.32 per cent in the last two sessions.
Forex dealers said dollar's weakness against other currencies overseas supported the rupee.
