Dealers said Rupee dropped to its lowest since late August 2007 as refiners scrambled to cover their import payment needs after crude hit a record high near USD 121 per barrel.
However, it opened low at 40.65/66 per USD, recorded the day's high at 40.62 and a low at 40.98 to end at 40.95/96 per dollar, 0.8 percent lower from Monday's close of 40.60/61.
The Reserve Bank of India today fixed the reference rate for US Dollar at Rs 40.69, up 14 paise from yesterday's rate of Rs 40.55 per USD.
The six-month premium was quoted at 1.65/67 (1.75/77) per cent and annualised premium closed at 1.45/47 (1.55/57) per cent.
The local currency ended the session at 63.62/64 (62.65/67) against the Euro. It closed at 80.73/75 (79.70/72) per unit against the Pound Sterling. The local unit closed at 39.18/20 (38.50/52) per hundred units against the Japanese Yen, dealers added.