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.