In a poll conducted by news agency Reuters ahead of the release of GDP data, two-thirds of 66 economists expect the MPC to announce a 25-basis-points cut in the repo rate to 5.75 per cent.

If the expectations are met, the RBI would have reduced the repo rate for a third bi-monthly policy review in a row. The last time the central bank cut repo rate for the third time in a row was in 2013.

Consumer inflation has remained within the RBI's medium-term target of 4 per cent for ninth straight month. In April, consumer inflation - determined by Consumer Price Index (CPI) - came in at 2.92 per cent, as against 2.86 per cent in the previous month.

Some analysts say the MPC may decide to adopt an "accommodative" policy stance, which would mean a reduction may happen any time. In its last scheduled policy review in April this year, the RBI had retained its policy stance at "neutral". The current stance allows the central bank to either tighten or cut repo rate.

"I expect RBI to cut rates by 25 basis points, change their monetary stance to accommodative and strongly address the liquidity deficit, may be even go for a surplus liquidity framework from neutral one presently. Inflation is not of concern and economic growth needs support," said Amar Ambani, president and research head, Yes Securities.

Government data last month showed India's GDP or gross domestic product grew 5.8 per cent in the quarter ended March 31, marking the slowest pace in more than four years.

Given the economic slowdown and weak consumption, with major auto makers lowering their sales projections, a larger reduction in repo rate cannot be ruled out, say analysts.

“Liquidity woes in banking system are far from over. The silver lining in this is the expectation of government spending, which is likely to reduce the liquidity deficit in the system,” said Lakshmi Iyer, chief investment officer (debt) and head products, Kotak Mahindra Asset Management Company.

Some also say the June 6 statement can be a big booster for the stock markets.