RBI Will Deliver a Final 25 bps Rate Cut in December: HSBC Global Research

The Reserve Bank of India (RBI) will deliver a final 25 basis point rate cut in the December monetary policy committee (MPC) meeting, taking the repo rate to 5.25 per cent by the end of 2025, a report said on Tuesday.

- AGENCIES

Considering the ease in inflation in recent months, the RBI may leave the repo rate unchanged in the next two MPCs.

"We forecast a pause in the August and October meetings. However, we believe the RBI will deliver a final 25bp rate cut in the December meeting, taking the repo rate to 5.25 per cent by end-2025," a HSBC Global Research report said.

June CPI inflation came in at much below the market expectation of 2.3 per cent. Meanwhile, the sequential momentum has been flat since April. The current inflation can be attributed to much lower-than-anticipated food inflation, and it may reduce further as well.