📰 Today’s Highlights – 5 August 2025
The Indian rupee extended its slide, dropping to ₹87.6550/USD, marking a 1.2% weekly loss as importer dollar demand—especially from state-run oil firms—and continued foreign equity outflows weighed heavily. Though it opened stronger on weaker U.S. job data fueling Fed rate-cut bets, gains faded by midday.
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A renewed threat of steeper U.S. tariffs on Indian goods pushed the rupee dangerously close to its record low past ₹88; the one-month non‑deliverable forward quotes signal a possible open in the ₹88.00–88.04 band.
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RBI’s MPC meets August 4–6 to decide policy; economists expect the repo rate to remain at 5.50%, though growth concerns from tariffs have lifted the odds of a cut by year-end to about 35%.
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Moody’s warns that NBFCs may benefit from lower funding costs due to cumulative 100 bps cuts since February, though margin pressure from sector competition remains a concern .
Daily Current Affairs – MCQs (5 August 2025)
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What was the rupee’s closing rate today?A) ₹87.42B) ₹87.54C) ₹87.6550D) ₹88.00Answer: C) ₹87.6550Explanation: Rupee slid further despite opening softer, pressured by importer dollar demand and sustained foreign outflows.
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What caused the rupee to lose early gains?A) Oil price surgeB) RBI rate guideC) Importer dollar bids and equity outflowsD) Strong export remittancesAnswer: C) Importer dollar bids and equity outflowsExplanation: State-run oil firms’ dollar demand and foreign equity selling offset USD weakness from Fed rate-cut hopes.
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What record risk did traders warn of today?A) ₹90 level breachB) ₹88 lifetime low breachC) RBI rate cut probability collapseD) Equity rally excessiveAnswer: B) ₹88 lifetime low breachExplanation: Renewed threat of steeper U.S. tariffs pushed the rupee near its record low ~₹87.95; NDFs hinted at an open above ₹88.
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Which upcoming policy meeting holds key importance?A) Monetary Policy Committee (Aug 4–6)B) Budget sessionC) Parliament emergency sittingD) RBI board on gold reserveAnswer: A) Monetary Policy Committee (Aug 4–6)Explanation: MPC convenes to decide policy amid tariff headwinds and growth risks.
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What is the likely repo rate outcome?A) Increase to 5.75%B) Cut to 5.25%C) Hold at 5.50%D) Zero rateAnswer: C) Hold at 5.50%Explanation: Most economists expect no change at Wednesday’s meeting, despite rising odds of a future cut.
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What institutional segment stands to benefit from past rate cuts?A) BanksB) NBFCsC) Large cap equitiesD) Public sector undertakingsAnswer: B) NBFCsExplanation: With lower borrowing costs after 100 bps of rate cuts this year, NBFCs gain—but margin pressure remains from intense competition.
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Which U.S. economic data spurred speculation of a September Fed rate cut?A) Strong GDPB) Weak July jobs dataC) Rising inflationD) U.S. trade surplusAnswer: B) Weak July jobs dataExplanation: Disappointing nonfarm payrolls triggered dour sentiment on dollar strength and lifted hopes for rate easing.
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How did Asian currencies perform amid a soft dollar?A) All weakenedB) Indian rupee surgedC) Malaysian ringgit and Indonesian rupiah led gainsD) Only Chinese yuan gainedAnswer: C) Malaysian ringgit & Indonesian rupiah led gainsExplanation: These peers rallied as the dollar retreated; Indian gains were capped by domestic factors.
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What weekly range is the rupee expected to trade in?A) ₹86–86.50B) ₹87.00–87.80C) ₹88.00–88.50D) ₹85.50–86.00Answer: B) ₹87.00–87.80Explanation: Analysts project range-bound trading in this band, with intervention likely to limit excessive swings.
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What describes the short‑term outlook for the rupee?A) Strong recoveryB) Volatile with depreciation risk above ₹88C) Firm peg to the dollarD) Range‑bound stability near ₹86Answer: B) Volatile with depreciation risk above ₹88Explanation: Ongoing U.S. tariff tensions, equity outflows, importer demand, and Fed uncertainty fuel downward bias.
✅ Summary:
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