The Indian rupee has fallen 52 paise to Rs 53.75 per US dollar a day after a move above the Rs 53 per dollar-mark.

There was demand for the American currency from banks and importers and weak performance by domestic stocks. The US dollar rose against the euro and other currencies due to the continuing euro zone debt crisis, according to the forex dealers.

The international trends along with a weak performance of domestic share market amid a slowdown of the domestic economy. They added that the increased demand for the US currency increased pressure on the rupee.

Finance Minister Pranab Mukherjee has also expressed concern over the declining value of factory output and rising subsidies. The central bank, the Reserve Bank of India (RBI) is expected to intervene if the rupee declines further.

The Mid-Year Analysis 2011-12, which is presented to the parliament said about the currency valuations that the various currencies around the world show some tendency to 'overshoot' periodically.

It said that the fall in the value of rupee is due to global economic uncertainty and the flight of capital to the relative safety of the US treasury. “However, given that inflation has been high in India compared to the US, it is only to be expected that there will be some depreciation in the rupee vis-a-vis the US dollar," it read.