They also said that a CRR cut of 0.25 per cent is likely.
"The decline in core inflation is welcome and will provide some comfort to the RBI, but the November uptick in CPI inflation and the firm HSBC PMI price readings suggest that we are not out of the woods yet," HSBC Chief Economist for India and ASEAN Leif Lybecker Eskesen said in a research note.
Wholesale price based inflation eased to 7.2 per cent in November as against 7.5 per cent in October on account of a decline in fuel and core inflation.
According to HSBC, the RBI will keep the policy rate on hold next week, although it is likely to cut the CRR by 0.25 per cent to address the lingering liquidity tightness.
Barclays Capital Economist Siddhartha Sanyal said in a research note:
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