According to global brokerage firms like, Bank of America Merrill Lynch, Barclays, Citigroup and HSBC, inflation is likely to stay "benign" through the year 2015.
Even though monsoon is likely to be a risk factor, inflation is likely to stay "softer" on account of lower commodity prices, they said.
"With inflation declining consistently and given the slack in the economy according to the RBI's industrial survey, we continue to see room for the RBI to lower policy rates in the first half of 2015," Barclays said in a research note adding "we maintain our forecast of another 50 bp of repo rate cuts in the first half of 2015."
Retail inflation moved up to 5.11 per cent in January month-on-month, measured on a new base year 2012, mainly due to dearer food items including fruits and vegetables.
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HSBC in a research note said "we expect the central bank to cut the policy repo rate by 25 bps in March/ April, followed by a final 25 bp rate cut in June".
After markets factor in the expected Fed rates hike in September, the RBI is expected to cut another 50 basis points in early 2016, BofA-ML added.
Citigroup in a research note said it "currently" maintains its view of a cumulative 75 bps easing on benign inflation, and expectation that the February budget would reinforce fiscal consolidation but it is awaiting RBI's interpretation of the GDP data/output gap for further clarity.
RBI Governor Raghuram Rajan, in the monetary policy review earlier this month, kept key interest rate unchanged saying the apex bank wanted more comfort on inflation front as it awaited cues from Finance Minister Arun Jaitley's first full year Budget.