The Indian rupee today fell for the second day against the US dollar, tracking broad strength in the American currency. The rupee today settled at 73.60, down 26 paise from the previous close, after trading in the range of 73.39 to 73.65 against the US dollar. The rupee had settled at 73.34 against the US dollar in the previous session.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.57% to 93.260. 

Rupee downfall continues: The currency breaches 72 against dollar for the  first time - Sentinelassam

Foreign institutional investors were net sellers in the capital market as they sold shares worth 6.93 crore on a net basis on Monday, according to exchange data.

"If the broader USD remains stable the down side in USD-INR could be limited. It appears the RBI is content keeping volatility in check and allowing readjustments in USD/INR happen when there is a significant global USD move. Whenever that happens, the RBI steps aside and allows the rupee to align with the broader USD," said Abhishek Goenka Founder and CEO, IFA Global.

The rupee is down over 3% so far this year against the US dollar. The rupee has pulled back from about 77 levels against the US dollar amid strong inflows into domestic equity markets and broad dollar weakness.