The Indian Rupee has continued its downward slide and recorded a decline of 1.1 percent to 52.7012 per dollar at the time of reporting this morning.

The weak performance by the Indian currency is due to continuing weak performance by domestic shares and high demand for the American currency from importers. Some now expect the rupee to move to an even weaker position of 54 to 56 per dollar.

According to dealers in the foreign exchange market, the rupee will continue to fall until there is an inflow of funds into the country or there is stability in the Eurozone courtiers. The eurozone is facing a sovereign debt crisis with Greece among the most hit but the crisis is not threatening to spread to larger economies of Italy and Spain. The RBI has hinted that it will look at using its foreign exchange rupee to protect depreciation of the rupee.

The BSE India Sensitive Index of shares fell 22 percent as investors pulled out from the domestic shares due to debt concerns in the US and Europe. Offshore investors pulled $1.7 billion from local equities after reaching a high of $104.4 billion in July.

Union Finance Minister Pranab Mukherjee raised the government's borrowing target by 13 percent to a record 4.7 trillion rupees this September due to global and domestic factors.