Reddy, who had an hour-long meeting with Chidambaram, however, declined to make any comments.
However, analysts expect the central bank to tighten money supply by increasing the mandatory deposit that banks keep with the central bank (CRR) to counter inflation, which is ruling at a 13-year high.
The wholesale price based-inflation, though marginally eased by 0.02 per cent to 11.89 per cent for the week ended June 12, is still at 13-year high level.
The price rise is a major cause of concern for the UPA government which, though on political front is breathing easy after winning the trust vote in Parliament on July 22.
Meanwhile, industry chamber FICCI, making a case for a liberal credit policy, today said the current monetary stance, which is aimed at controlling inflation, is having the exact opposite effect with capacity expansion being deferred and have the real risk of causing stagflation.
The government is also concerned that the industrial sector dipped to below 4 per cent in May and the GDP growth is likely to slow down to around 8 per cent this year.
Finance Ministry, which has taken a host of fiscal measures to tame inflation, is of the opinion that monetary policy was the first line of defence against inflation.