📰 Today’s Highlights – 1 August 2025
The Indian rupee came under severe pressure, dropping to ₹87.42/USD, its steepest one-day decline since May, as new 25% U.S. tariffs on Indian exports took effect, alongside importer demand and sustained foreign outflows. Intervention by the RBI helped stabilize the currency midday.
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Global markets were rattled by U.S. job reports showing weak July data, weakening dollar sentiment and raising pressure for a Fed rate cut.
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Despite trade tensions, India is still in active talks with the U.S., with officials expecting a delegation visit later this month as broader negotiations continue beyond the August 1 deadline.
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In India’s export community, the Commerce Minister will engage exporters from 2–4 August in Mumbai, focusing on worst-hit sectors like textiles, food processing, and engineering amidst tackling tariff fallout.
Daily Current Affairs – MCQs (1 August 2025)
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**What was the rupee’s exchange rate today?**A) ₹86.80B) ₹87.11C) ₹87.42D) ₹87.75Answer: C) ₹87.42Explanation: The rupee slid as low as ₹87.74 before recovering to ₹87.42 after RBI intervention amid tariff-related panic and capital outflows.
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**What triggered the sharp fall in the rupee?**A) RBI rate hikeB) Oil price spurtC) Fear of U.S. trade tariffs and importer demandD) Strong trade dataAnswer: C) Fear of U.S. trade tariffs and importer demandExplanation: The threat and implementation of 25% tariffs on Indian goods, plus importer dollar buying pressure, pushed the rupee down sharply.
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**How large was the rupee’s one‑day fall?**A) ~0.2%B) ~0.5%C) ~0.7%D) ~1.0%Answer: C) ~0.7%Explanation: The rupee dropped around 0.7%—its biggest decline since May—amid escalating trade tensions.
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How did the RBI respond?A) Raised interest ratesB) Sold dollars to support the rupeeC) Imposed export restrictionsD) Announced forex reserves sale policyAnswer: B) Sold dollars to support the rupeeExplanation: Traders report RBI intervened via state-run banks in spot and NDF markets to curb losses.
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**Which major global event is due tomorrow?**A) ECB policy meetingB) Fed policy decisionC) G20 summitD) India’s monsoon forecastAnswer: B) Fed policy decisionExplanation: Markets are awaiting the U.S. Federal Reserve’s decision and Chair Powell’s commentary amid weak jobs data.
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**What looming trade concern hit markets today?**A) India–EU customs dutiesB) India–U.S. tariff implementationC) India–China duties rollbackD) India–UK rail dealAnswer: B) India–U.S. tariff implementationExplanation: A 25% tariff on Indian exports came into effect today in absence of a U.S.–India trade deal by the August 1 deadline.
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**When are export-focused discussions planned publically?**A) 5–7 Aug in DelhiB) 2–4 Aug in MumbaiC) 10–12 Aug in KolkataD) No meetings scheduledAnswer: B) 2–4 Aug in MumbaiExplanation: Commerce Minister Piyush Goyal will meet exporters in Mumbai from 2–4 August to address tariff concerns across key sectors.
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**Which sectors are most affected by new tariffs?**A) Telecom & miningB) Automobiles onlyC) Apparel, food processing, engineering, chemicalsD) Digital servicesAnswer: C) Apparel, food processing, engineering, chemicalsExplanation: These export sectors are flagged as among the hardest hit by U.S. tariff measures.
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**What broader trade strategy is India pursuing?**A) Avoid U.S. talks altogetherB) Explore phased or selective tariff reductionsC) Adopt third‑party trade modelD) Decline all trade dealsAnswer: B) Explore phased or selective tariff reductionsExplanation: Analysts suggest a three-part phased trade deal may be explored, rather than blanket liberalization.
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**What is the near‑term rupee outlook?**A) Rapid recovery to ₹85B) Further decline past ₹88C) Some support from intervention; but lingering downward biasD) Stabilized in narrow band ₹86–86.20Answer: C) Some support from intervention; but lingering downward biasExplanation: While central bank action capped losses, fears around tariffs and outflows suggest continued pressure.
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