"I do expect those measures (Cash Reserve Ratio and Statutory Liquidity Ratio reduction) could be taken to further ease liquidity," PMEAC chairman Suresh Tendulkar said.

As domestic fund position is tight, he said, "Either of the instruments could be used to infuse liquidity in the system."

Tendulkar further stressed that since the inflation seems to easing, the policy stance of the Reserve Bank as well as the government should "gradually... shift towards growth."

Last week, RBI slashed CRR by 150 basis points to 7.5 per cent, a move that has released Rs 60,000 crore in the cash strapped banking system. The impact of the cut in the ratio which came into effect on Saturday will be felt on Monday.

In the past five years, this is the first time that the apex bank has gone in for reducing the CRR. RBI last reduced the ratio in June 2003.

When asked whether the RBI should go in for reduction of the short-term lending (repo) rate to boost liquidity, Tendulkar said, "At this juncture I would not rule out a cut in repo rate."