Rupee fell 26 paise to close at 73.87 (provisional) against the US currency at close on Wednesday. American currency remained strong in the overseas markets ahead of the outcome of the Fed Meeting.
The local currency opened at 73.70 and touched an intra-day high of 73.66 against the dollar in trading hours today. It eventually settled 26 paise lower its previous close.
The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.02 per cent higher at 93.22.
Foreign Exchange traders await the outcome of the Fed meeting expected later in the day on Wednesday. Apprehensions about taper timeline and US Fed's projections continued to dominate the day.
United Stated Fed Chairman Jerome Powell will be speaking about the tapering of the central bank's bond purchases after the Federal Open Market Committee (FOMC) meet on Wednesday. Investors fear the reduction in bond purchases by Fed Reserve would reduce the liquidity in world markets. Minutes of the July Federal Open Market Committee meet showed that most committee members were in favour of reducing asset purchases. Back then, stock markets globally corrected and bond yields hardened.
Brent crude futures, the global oil benchmark, rose 1.24 per-cent to $75.28/barrel.
BSE Sensex ended 77.94 points or 0.13 percent lower at 58,927.33 while the broader NSE Nifty declined 15.35 points or 0.09 percent to 17,546.65.