The rupee continued its downslide for the third day in a row and declined by 19 paise to end at 56.15, its second lowest closing in history, against the U.S. currency as cautious importers bought dollars in late trade ahead of outcome from the key U.S. Federal Reserve meeting.

At the Interbank Foreign Exchange (Forex) market, the domestic unit opened higher at 55.92 a dollar from previous close of 55.96 and immediately touched a high of 55.82 on dollar selling by exporters and initial rise in local shares.

However, as the session progressed it weakened and fell back to a low of 56.18 before concluding at 56.15, its second lowest closing. On May 30, 2012 the rupee had settled at 56.23. It has depreciated over 16 per cent since early March and hit a record low of 56.52 (intra-day) on May 31, 2012.

Forex dealers said some weakness in dollar overseas, renewed capital inflows and positive closing of local stocks capped the negative sentiment against the rupee.

The euro rose marginally to $1.27, after adding gains of nearly 1 per cent on Tuesday and within striking distance of a one-month high of $1.2748 hit earlier this week.

Euro edged higher on Wednesday as investors waited to see if the Fed will announce fresh monetary stimulus at the end of the two-day meeting later Wednesday to boost the ailing U.S. economy.

The dollar index, a gauge of six major rivals, was also down by over 0.05 per cent while New York crude oil was trading above $84 a barrel in European market on Wednesday.

More In: Markets | Business