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The U.S. had no business dropping points, much less losing. And yet it did.

What's the meaning of had no business here?

Is it like did not need at all? Or were not interested in? Or by all means had to avoid? Or something else?

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have no business can be used in a wide variety of circumstances all of which could be paraphrased as "X should not be happening". Sometimes it is used "tongue-in-cheek", as with the first example below:

She has no business being so pretty and distracting everyone.

You have no business being here after the building has been locked.

The country has no business supporting rebel militias.

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Your last suggestion seems to have a close meaning:

https://dictionary.cambridge.org/dictionary/english/have-no-business-doing-sth

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