A day after the Reserve Bank of India decided to keep its policy rates on hold, some top equity research firms, including Morgan Stanley and SBI Research, today said that the central bank may ease the rates on favourable macroeconomic data.

A few others such as Nomura and DBS, however, said that RBI is in a “neutral gear” and the rates are likely to remain on hold.

On its part, RBI has said that its future rate action would depend largely on three key factors — inflation, monsoon progress and the US Fed action.

Morgan Stanley said in a research report that evolving inflation trajectory will create room for more policy rate cuts.

“We hold to our view that inflation will be sustainably lower at 4.8 per cent year-on-year in the quarter ended March 2016,” Morgan Stanley said.

Assuming monsoon rainfall is not in deficit of more than 10 per cent for the season, the food inflation trend is unlikely to be affected and hence headline inflation will stay on a deceleration path, it added.

“Indeed, we expect the RBI to cut rates by 25 bps in the September meeting, followed by further rate cuts of 25-50 bps through quarter ended March 2016,” the Morgan Stanley report said.

State Bank of India’s research arm, SBI Research also expects the central bank to deliver one more rate cut.

“...the RBI forward guidance clearly spells out the possibility of more monetary accommodation. In our view, though such action will be data dependent, there seems to be a bias towards at least one more cut,” SBI Research said in a note.

On the other hand, DBS said in a research note that RBI is likely to remain largely data-dependent during the rest of this year.

“We continue to expect the RBI to keep rates on hold in September, but acknowledge an easing bias,” DBS said.

Japanese brokerage Nomura also reiterated similar views and said that RBI is in “neutral gear” for now and expects rates to stay on a prolonged hold.

“In our view, policy rates in India are already at neutral levels and our macroeconomic forecasts do not support further easing for three reasons: firstly, growth is already in the initial stages of a business cycle recovery; secondly, sustained disinflation is unlikely; and thirdly, inflationary expectations are still high,” Nomura said in a report.

After three cuts in seven months, RBI had yesterday decided to keep the benchmark lending (repo) rate unchanged at 7.25 per cent as also the cash reserve ratio (CRR) at 4 per cent.