Archive · 18 Jul 2025
Morgan Stanley Predicts RBI Rate Cut in October Amid Falling Inflation
Imagine the cost of things going down in India.
Morgan Stanley thinks the people in charge of interest rates might lower them a little bit in October, but wait in August.
This is because prices of things, especially food, are getting cheaper.
Good weather and the government's help with prices are the reasons for this change!
Morgan Stanley projects the RBI to cut rates by 25 bps in October.
The brokerage expects the RBI to hold rates in its August meeting.
CPI inflation has been below 4% since February, reaching 2.1% YoY in June.
Food inflation entered a deflationary zone in June, with a 1.1% drop.
Favorable rainfall and government policies contribute to cooling food prices.
- Who
- Morgan Stanley and the Reserve Bank of India (RBI)
- What
- Morgan Stanley anticipates another 25 bps rate cut in October.
- When
- The rate cut is expected in October, following a pause in August.
- Where
- India
- Why
- Due to falling inflation and favorable factors like good rainfall.
- Expected Rate Cut
- 25 bps in October
- August Policy Meeting
- Rates expected to remain unchanged
- CPI Inflation (June)
- 2.1% YoY
- Food Inflation (June)
- -1.1%
- H1 CY25 Inflation
- 3.2%
