WPI inflation fell to 40-month low at 5.96 per cent during March as compared to 6.84 per cent in the previous month.
A leading media report suggested quoting Deutsche Bank's official that "We think RBI will support an easing monetary policy bias in the next few months. Consequently, we expect the central bank to cut the repo rate by clips of 25 basis points in the next two policy meetings (May and June)."
While some economists said that a repo rate cut alone would not solve the purpose till CRR remains unchanged, some other economists said that RBI may refrain from rate cut in May as Current Account Deficit (CAD) and retail inflation remain high.
CAD came in at 6.7 per cent of GDP during December quarter while retail inflation has remained above the double-digit mark in March.