The Reserve Bank of India may again revise key interest rates by around 50 basis points in next couple of days at a time when inflation rate reduced to 0.44 per cent and country is moving toward deflation.

The significant decline in inflation gives enough room to Apex bank for interest rate revision in order to stimulate demand in the economy, facing the heat of global slowdown. However, the central bank is unlikely to revise cash reserve ratio and statutory liquid ration according to the officials of finance ministry.

As per reports of a major Indian Newspaper, a source close to the development informed, "Inflation is just one of the factors behind RBI decision to cut rates. However, a softening inflation, which is leading to deflation, may prompt RBI to cut policy rates further."

Banks have sufficient liquidity and perking around Rs 20,000 crore of excess deposits with the central bank on daily basis.

A senior RBI official said, "Decision on policy rates is linked to various global and domestic factors, such as commodity prices, inflation numbers and bank rates, while reserve rates are directly linked to the liquidity situation in the banking system."