The rupee declined 14 paise and touched the crucial 86.00mark (provisional) for the first time against the US dollar on Friday as it failed to resist pressure from a stronger American currency and huge outflow of foreign funds.

The rupee's fall below the psychologically important 86 level is likely "sooner rather than later," a trader at a foreign bank said.

The Indian rupee weakened to its lifetime low on Thursday as the dollar strengthened on the back of expectations of slower-than-anticipated rate cuts by the Federal Reserve as well as uncertainty about the incoming U.

The rupee depreciated 9 paise to hit its record low of 85.83 against the US dollar in early trade on Wednesday as strengthening American currency and higher crude oil prices continued to play spoilsports even as the government lowered the country's economic growth projection.