Overview

• SBI Research recommends a 25 bps reduction at the Sept. 29–30 MPC, with the policy decision due Oct. 1.
• The report projects October CPI could drop to about 1.1% with GST changes, while without GST cuts inflation is already tracking below 2% for September and October.
• SBI estimates a 65–75 bps CPI decline from GST rationalisation and an additional 20–30 bps moderation from the revised CPI series.
• The firm says CPI in FY27 is now tracking around 4% or less, reinforcing its benign-inflation view.
• RBI kept the repo rate at 5.50% in August, and SBI cautions that not cutting now would be a 'Type 2 error' and urges calibrated communication as global yields harden.