India May Cut Rates To 5.25 Percent On December 5, Shows Reuters Poll

The India rate cut forecast 5.25 gained firm ground after a Reuters poll on 27 November 2025 showed that most economists expect the Reserve Bank of India to bring the repo rate down to 5.25 percent during the Monetary Policy Committee meeting scheduled between 3 and 5 December 2025.

The Reuters poll conducted between 18 November 2025 and 26 November 2025 gave a strong reading. Sixty two of eighty economists predicted a cut. The push came after headline consumer inflation touched 0.25 percent in October 2025. Food prices slipped across major items. Liquidity stayed steady in the banking system across October 2025.

Readers often look at official data to understand the wider change. The next table marks the key numbers released through Government-linked pages. A short view of these figures gives context on the broad policy room.

Government Indicators For Policy And Growth

All figures listed below appear in official releases hosted on Government-linked sites.

These numbers help explain why a rate cut gained traction. Low inflation and steady demand opened space for the RBI to act in December 2025.

Why Does Policy Support A Possible Cut?

Policy often appears too broad for readers. A simple meaning helps. A rate transmission system means banks change their loan and deposit rates when the RBI shifts the repo rate. This change works in steps. The signal comes first. Banks then reset prices over the next few weeks.

External data adds more depth. Loansjagat noted in a 2025 update that food inflation fell to minus 5.02 percent while core inflation settled near 4.4 percent. This gap slows the way banks move loan rates. It also means the benefit of a December cut may not reflect in home loan or business loan EMIs at once. A structured look at past policy cycles covers how the response formed in earlier years.

The table below shows key policy actions recorded in Government-linked reports.

Policy Actions Recorded In Past Years

These actions explain how the RBI reacted to inflation and supply issues in earlier cycles. 

It also gives a clue on how banks may behave after the December 2025 meeting. A Reuters report dated 28 November 2025 examined India’s Q2 GDP trend. That report said domestic demand stayed firm through the quarter ending September 2025. This base made a possible rate cut more credible once inflation cooled in October 2025. The December meeting now sits as the next step in that chain.

This link to past coverage helps track how the rate outlook formed over the last two months.

Conclusion 

Government and bank responses in past years show a clear pattern. In 2020, banks took nearly twelve weeks to cut lending rates after the 115 bps policy reduction. The Ministry of Finance noted this delay in its June 2020 status paper. In 2023, banks again moved slowly when core inflation stayed higher. The shift came only after the RBI used liquidity tools to nudge alignment.

These past responses may repeat after December 2025. The expected repo rate at 5.25 percent could lower funding costs, yet banks may take time to reset EMIs due to internal pricing systems and credit risk checks.

India now moves into a key policy decision with inflation at 0.25 percent, a repo rate of 5.50 percent and a clear forecast built through the Reuters poll. The outcome of the December meeting will shape borrowing, spending and investment across the next few quarters.
 

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