Reddy, who had a detailed meeting with Chidambaram, was tight-lipped over the outcome but indications are that some fine-tuning of Credit Policy to be unveiled on April 28 figured prominently.
Although bankers favour easing of Statutory Liquidity Ratio and Cash Reserve Ratio, RBI is unlikely to revise them before the amendments in Banking Regulation Act and RBI Act.
There is also an expectation of revision in bank rate but bankers said there is ample liquidity to the tune of Rs 30,000 crore (Rs 300 billion) in the banking system, which may prompt RBI to keep rates stable in the short term.
India Inc also wants RBI to ensure a stable interest rates regime, steps to check rupee appreciation and growth oriented Credit Policy on April 28.
Going by Finance Minister P Chidambaram's ambitious target to increase farm credit to Rs 1,40,000 crore (Rs 1400 billion) in 2005-06, the central bank may announce steps to ease the flow of credit to the needy sector.
Analysts expect RBI to lower inflation forecast for this fiscal as India has been able to absorb the initial oil price shocks and kept prices of fuel stable in the domestic market although global crude prices was hovering over $50 a barrel in the last few months.
Bankers also expect RBI to come up with a roadmap for bank mergers and the steps for proper implementation of the Basel II norms.