Mumbai: The Indian currency has fallen from near decade highs today following worries that abroad funds may cut down equities positions after U.S. stocks snorted from changed jitters regarding the fallout from the subprime credit situation.

Under pressure in early dealings, the partially convertible rupee stood at 39.43/44 per dollar in early trading (9:40 a.m.). Yesterday, it ended the day at 39.310/315, after rising to 39.22 during trading, its highest peak since March 1998.

The chief trader with a foreign banking institution said, “The equity market sell-off in the U.S. is likely to have a negative bearing on the Sensex, and the market is positioning itself for some outflows.”

Financial securities dragged out Wall Street sharply lower on Thursday, after brokerage houses demoted Citigroup and Bank of America, actuating more worries about the happening from the credit crisis.

Yesterday, Sensex also closed on a weaker note, while it has made around 26% since the U.S. Federal Reserve slash interest rates during September. The Fed reserve cut rates again earlier this week.

Foreign capitalists have pumped-up over $17 billion into Indian securities in the recent year, and these resources have been a prime driver of the rupee’s advancements of around 12%.

Market traders were also watchful on building positions in the Indian currency after the RBI was broadly seen interposing to limit the currency's gains on Thursday.

In the first eight months of the recent year, the RBI has purchased around $40 billion to test out the rupee’s advancement, and market analysts said it had intervened through September and October.