Mumbai : Continuing on slippery slope, the rupee slumped to a new record low of 56 to the US dollar on Wednesday weighed down by global risk aversion, with the Reserve Bank of India’s intervention earlier in the day seen as too mild to prevent further falls.

At 12:40 pm, the partially convertible rupee was at 55.98/99 per dollar, after hitting a new record low at 56, sharply below its Tuesday’s close of 55.39/40.

The euro stayed pinned near recent four-month lows while domestic stocks were down more than half a percent.

The dollar has been gaining strength against other global currencies as well.

The rupee has continued the fall for the sixth day in a row despite some steps taken by the Reserve Bank amidst capital outflows from foreign funds and weakening equities.

The rupee resumed lower at 55.65 per dollar against the last closing level of 55.39 per dollar and dropped further to an all-time low of 55.95 per dollar at 1236 hrs.

In New York market, the US dollar rose to its highest level since January against a basket of major currencies, bolstered by a drop in the Japanese yen after Fitch cut Japan’s sovereign rating to A+ from AA.

Traders said increased dollar demand from banks and importers, especially oil refiners coupled with capital outflows from foreign funds following melting stocks mainly affected the rupee value against the dollar.

They said the plunging dollar had overshadowed the stocks market as the BSE benchmark Sensex dropped below the 16,000 mark, down 179 points in midsession trade on Wednesday.

The market regulator, SEBI data showed that FIIs sold worth Rs 283 crore of Indian stocks on Tuesday with the Sensex losing 157 points.