The rupee recouped most of its losses on Wednesday to end marginally weaker, after dollar buying by players in the offshore non-deliverable forward (NDF) market abated and exporters sold the US currency, traders said.
But traders said with the local stock market shedding nearly 2 percent on Wednesday, the rupee was likely to trade with a weak bias in the near term.
The partially convertible rupee ended at 45.1750/1850 per dollar, off a intra-day low of 45.41 and marginally weaker than Tuesday's finish of 45.16/1675, the lowest close since November 4, 2004.
At Wednesday's low, the rupee, which is overvalued by about 8 percent on a trade-weighted basis, had lost about 3 percent from the beginning of the month.
"This was a great level for exporters to sell their dollar earnings," said a chief dealer at a large state-run bank. "Also the dollar purchases from the offshore forward market were not as strong as in the previous sessions."