The Indian rupee was lower versus the U.S. dollar in the evening session on Tuesday, as strong U.S. economic data raised concerns that the Federal may raise interest rates more than expected.

Overnight data showed that U.S. service sector activity unexpectedly grew at an accelerated rate in the month of November.

The data fuelled fears that the Fed could raise interest rates for longer.

Traders looked ahead to the Reserve Bank of India's monetary policy announcement, due on Wednesday. The RBI is expected to raise lending rate by 35 basis points to 6.25 percent from 5.9 percent.

The Indian rupee depreciated to 82.64 against the greenback, its lowest level since November 4. If the currency falls further, it may challenge support around the 83.00 level.

US Dollar vs INR (FX:USDINR)
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