The local currency commenced lower at 54.03 a dollar yesterday's close of 53.86 at the Interbank Foreign Exchange (Forex) market.
Later, it moved in a tight range of 54.00-54.22 before ending at 54.09, a fall of 23 paise, or 0.43 per cent. In the last two sessions, it had gained 87 paise, or 1.60 per cent.
Forex dealers said, however, some capital inflows and weak dollar overseas cushioned rupee's fall to some extent.
He added that forex market is expecting some positives on containing the fiscal deficit and borrowing side, which might boost the rupee sentiment. "Rupee will move in the 53-55 range this week," Raina said.
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Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said, "Rupee ended the day on a weaker note. The rupee lacked clarity from most parts of the day today, hovering in a band 22 paise. No clear cues were seen ahead of the crucial Budget to be unveiled on February 28.