Besides, increased demand for the American currency from importers and a weak opening in the domestic equity market also put pressure on the rupee, traders said.
However, dollar's weakness against euro and yen overseas after weaker-than-expected data ahead of Friday's jobs report, cushioned rupee's fall to some extent, they said.
This level is very close to rupee's all time low of 57.32 it had hit last June-end.
The rupee had lost 29 paise, its biggest single day fall in a week, to end at 56.73 against the dollar yesterday as importers bought dollars amid renewed concerns over withdrawal of US monetary stimulus.