The Indian rupee continued a downward slide on Wednesday to 55.82 rupees against the US dollar, from 55.39 on Tuesday.
There are concerns that slowing growth and a high rate of inflation may hurt the economy.
The rupee has been dropping against the US dollar since August last year, falling by almost 26% against the US currency since then.
On Tuesday, Finance Minister Pranab Mukherjee said that the government was taking a number of steps to arrest the volatility in the foreign exchange market and boost the rupee.
Earlier this month, the Reserve Bank of India asked exporters to convert 50% of their foreign exchange holdings into Indian rupees in an attempt to prop up the currency.
It also said that exporters would only be allowed to buy foreign currency after using all of the foreign exchange holdings in their accounts.