On Friday, Rupee fell by 31 paise against the dollar to close at 47.26/27 in the midst of cuts in interest rates as inflation has declined to a nine-month low.

The trade, which was fairly active, showed that the domestic currency started at 47.20/22 a dollar and later fluctuated between 47.36 and 46.86 on alternate bouts of dollar buying and selling during the day. Yesterday the rupee had closed at 46.95/96 a dollar.

“Concerns over a probable rate cut weighed on the rupee sentiment despite sliding oil prices and continued weakness in dollar in overseas markets,” said the dealers.

“The rupee also came under pressure after a slowdown in the capital inflow as the foreign institutional investors pulled out from the equity markets in the last two days,” they added.