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35 in late trading after the central bank broke a US dollar peg kept at 108 local units.
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A state bank that usually represents the central bank was selling dollars to the market at 110.00 rupees when trading resumed.
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The central bank said early morning that it was allowing limited depreciation of the rupee breaking a peg it had spent 800 million dollars to defend over the last two months.
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The rupee is expected to become more market determined over the next few days and weeks.
Analysts say reducing the volume of central bank interventions is key breaking a sterilized intervention cycle that had developed over the past two months.
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Updated
The rupee was at 110.75 to the US dollar in late afternoon trading with no intervention, dealer said.
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Late trading saw the rupee trading at 111.35 rupees, dealers said.