After a weak start at 56.40, the rupee fell further to 56.49 per dollar, reaching close to its record low level of 56.52 it touched on May 31. It had closed at 56.15 yesterday.
The US Federal Reserve launched new economic stimulus measures yesterday to tackle weak jobs growth, and predicted a slower output expansion amid the continuing debt crisis in Europe, especially in some euro-zone nations.
In New York, the euro turned weak against the dollar yesterday after the Federal Reserve's decision to extend its current bond-purchase operation.
Some analysts expected the Fed to either expand the programme more than it did, or resume outright bond purchases, which would have been more negative for the currency.
On Wednesday, the Fed extended a bond-swapping programme by six months, aimed at pushing down longer-term borrowing costs and stimulating the world's biggest economy.
Meanwhile, the BSE 30-scrip benchmark Sensex declined by 66.67 point or 0.39 per cent to 16,829.96 at midsession as foreign funds continued to sell equities.