Mumbai:The rupee on Friday weakened by 8 paise to close at 70.49 against US dollar on rise in demand for American currency from exporters coupled with unabated rise in global crude oil prices.
Besides, foreign fund outflows and stronger dollar against its key rival currencies impacted rupee trading pattern.
At Interbank Foreign Exchange, rupee opened strong at 70.38 a dollar against previous close of 70.41.
The local unit moved in a range of 70.34 to 70.59, before finally ending at 70.49, showing a loss of 8 paise.
On Thursday, rupee ticked higher by 5 paise to close at 70.41 per US dollar.
"Rupee becomes worst performing currency among Asian basket as foreigners continued selling domestic equity and debt.
Oil importers rush for dollar after crude oil back in to bull market (gained 24 per cent since mid-December)," said VK Sharma, head PCG capital markets strategy, HDFC Securities.
The dollar index, which gauges greenback's strength against a basket of six currencies, dipped 0.23 per cent to 95.31 in late afternoon trade.
Brent crude, global benchmark, was trading at $61.83 per barrel, higher by 0.24 per cent.
Brent crude was trading near $62 barrel and as a result, Indian rupee depreciated further, said Sunil Sharma, chief investment officer, Sanctum Wealth Management.
Meanwhile, foreign funds sold shares worth Rs 687.20 crore on a net basis Friday, while domestic institutional investors bought equities to tune of Rs 123.17 crore, provisional data showed.The Financial Benchmark India Private Ltd (FBIL) set reference rate for rupee/dollar at 70.4737 and for rupee/euro at 81.2083.
The reference rate for rupee/British pound was fixed at 89.9155 and for rupee/100 Japanese yen at 65.03.