Rupee weakened by 26 paise to trade at 54.78 against the US currency today on sustained dollar demand from banks and importers amid its higher value overseas.The rupee resumed lower at 54.65 per dollar as against the last weekend's level of 54.52 at the Interbank Foreign Exchange Forex Market. A forex dealer said persistent dollar demand from banks and importers in view of firm dollar in overseas market mainly affected the rupee value.