Reserve Bank Chairman D Subbarao said that RBI is monitoring the liquidity situation on regular basis and will take more steps to improve liquidity conditions in the financial system. He attended a meeting with finance minister P Chidambaram to discuss market conditions and liquidity situation. The meeting was also attended by ICICI Bank CEO, KV Kamath and union Commerce Minister, Kamal Nath.

Confederation of Indian Industry (CII) chairman, KV Kamath said that industry wants more fiscal measures to deal with the slowdown. Present interest rates are still high and industry expects more reduction in Cash Reserve Ratio by another 2.5 per cent. He said that banks are reluctant to lend cash to industry.

Mr Kamath said that ICICI bank is watching trends in demand and supply and would take final decision on interest rate cut after judging entire situation of financial market. He, however, hinted about interest rate cut by private sector banks within few weeks. It is noted that leading public sector banks had cut interest rates a week before.