RBI Governor Raghuram Rajan, criticised for following hawkish monetary policy for too long before starting to lower rates, has reduced the benchmark interest rate by 1.5 per cent since January last year. 

With inflation rearing its head again and global crude oil prices inching up, the Reserve Bank is likely to maintain the status quo on interest rates on Tuesday at its bi-monthly monetary policy review for the current fiscal, say experts.

Besides, the central bank may wait for the impact of delayed monsoon rains before making the next move.

RBI Governor Raghuram Rajan, criticised for following hawkish monetary policy for too long before starting to lower rates, has reduced the benchmark interest rate by 1.5 per cent since January last year.

Since then, he has been persuading banks to fully transmit the benefit of the policy rate cut to customers.

The customary post-policy press briefing by Rajan, whose current 3-year term as the central bank Governor ends in September, will also be closely watched for any cues relating to whether he is being given an extension.

"I don't see much in this credit policy. Interest rate wise, there would not be any change," IDBI Bank Managing Director Kishor Kharat said.

Tomorrow's review could also turn out be the last policy anchored by Rajan if the proposed Monetary Policy Committee (MPC) is put in place before the next review due on August 9.

Economic Affairs Secretary Shaktikanta Das had said the panel would be vested with powers to decide on interest rates from September onwards.

The six-member MPC will include RBI Governor and three nominees of the government, which has a mandate to bring consumer or CPI inflation to the pre-set target.

"RBI is likely to maintain status quo this time. Although there is consistency in inflation numbers, the last numbers do not give much comfort," a senior banker said.

"Only positive factor is good monsoon. RBI will wait for it to happen before taking any call on rate cuts," he said.

Retail inflation soared to 5.39 per cent in April on higher food prices, reversing a downward trend seen in recent months.

"With inflation remaining sticky at slightly above 5 per cent and growth fairly steady (although uneven), we expect policy rates to stay on hold until end-2016 (including at the upcoming policy meeting on June 7) with the focus shifting to liquidity provision," Nomura said in a report.

After a gap of six months, RBI had cut repo rate, at which it lends to other banks, by 0.25 per cent to 6.5 per cent in April. It was the first bi-monthly monetary policy review of the current financial year 2016-17.

Besides rising inflation, the crude oil price is also looking up and has touched $50 a barrel, from a low of about $30, and could increase inflationary pressures.

"Personally, I don't expect the Governor to cut the rates on Tuesday given the delay in the monsoons," StanChart India CEO Zarin Daruwala said.

According to Morgan Stanley, the Reserve Bank of India is expected to wait for the onset of monsoon to see the trend in actual inflation before proceeding for the rate cut.

However, some experts feel that there is a strong case of rate cut in the upcoming policy.

"There is a compelling reason for RBI to cut interest rate as inflation is low, monsoon projection is favourable and there is a need to push growth," Yes Bank Managing Director Rana Kapoor said.

"My sense is that the central bank would cut rate by 0.25 per cent this time and by similar percentage point in August before the busy credit season starts," he said.