Reserve Bank of India is unlikely to revise bank rate but is likely to suggest measures for improving financial health of banks in the slack season Credit Policy to be announced on Tuesday, bankers said.

Bankers and bond-dealers see ample liquidity and hence perceive no change in RBI's benchmark refinance rate, now at 6.0 per cent.

"A reduction in bank rate is unlikely in this Credit Policy. You already have excess liquidity. Moreover, interest rates in international markets are firming up," a senior official of Punjab National Bank said.

An official of Oriental Bank of Commerce said, "Bank Rate is expected to remain where it is now at 6.0 per cent. We have a comfortable liquidity and so the rates are expected to remain stable."

If inflation, which is mainly driven by petroleum prices, remains stable then it would ensure that the softer interest regime continues.

An official of PNB Gilts said bank rate has lost its relevance and hence it is unlikely to be revised in the Credit Policy.

Although RBI may not change bank rate, bankers said lending rates to agriculture and small and medium scale sectors may witness a downward movement in the coming days, as the rates were quite high compared to those in other sectors.

The reduction in lending rates on agriculture and SMEs was mainly on account of government directive to banks for lending funds at 2.0 per cent less than prime lending rates now at about 10.50-11 per cent.

Bankers ruled out a further decline in home loan rates. "It has bottomed out. After six months, when there will be a demand for credit from the industry, home loan rates may strengthen," the OBC official said.

Home loan rates for a five year maturity period are hovering at about 7-7.5 per cent.

Instead of revising bank rate, bankers expect RBI to focus on policies to improve transparency in banks and improvement in their quality of assets.

Bond dealers expect that RBI might allow them more freedom to raise funds especially through the external commercial borrowing route.

Primary dealers in government securities have also demanded that they should be allowed to trade in international securities and invest in commodities market.

PDs have asked RBI to provide them "limited-purpose" licence to deal in forex, especially inter-bank spot and forward markets, derivatives like currency swaps and hold over-night positions as banks do.

Although PDs are allowed to borrow foreign currency out of FCNR(B) funds of banks, the bond dealers now want RBI to allow them to raise money through ECBs.

Short-term ECBs should be allowed as funding sources for PDs within the same limits as FCNR(B) loans are allowed at present, they said.

Given the strong trading capabilities of PDs, dealers said commodity trading provides a good business opportunity for PDs.

Besides, commodities are supposed to be natural hedge to interest rate markets, giving PDs the opportunity to comfortably negotiate interest rate cycles, they added.