All the ingredients for the Australian central bank to cook up a rate reduction on May 1 are present, economists said, further making a strong case for a cash rate push back on Tuesday, which has been expected and demanded by many local industries.

The bond market has reached subdued levels, according to Australia & New Zealand Banking Group (ANZ), while official government figures pointed to the likelihood that inflation for much of the current year would remain within the target band set by the Reserve Bank of Australia (RBA).

According to the Australian Bureau of Statistics (ABS), consumer price index (CPI) for the March quarter registered a rise of only 0.1 percent, contravening the 0.7 percent increase that many economists have previously anticipated.

The latest CPI, the ABS, was in line with the annual inflation movement of 1.6 percent, again contrasting the 2.1 percent that the market has projected.

The economic indicators, the Australian Associated Press (AAP) reported on Monday, have prompted many analysts to believe that apart from the May rate cutback, at least two more will be rolled out by the RBA before the year ends.

It is highly possible that the RBA board will decide on slashing the official rate on Tuesday and again by next month, which could push down the country's cash rate below the 4.0 percent mark by the last quarter of 2012.

The benchmark overnight rate presently stands at 4.25 percent, which was last touched by the RBA December last year following two consecutive reductions that the bank then hoped would fuel growth in Australia's struggling industries.

Such similar intervention could be seen again in May and June, according to RBC Capital Markets senior economist Su-Lin Ong, who noted that the RBA, basing on the current condition, would have the sufficient room to operate on easing measures for the next two months.

"Given the (latest) inflation report ... we have always been of the view that the economy here has been trading at a sub-trend pace for a while, that the RBA has scope to ease," Ms Ong told AAP.

Additionally, the RBA is expected to factor in on its decision the likelihood that Australia's giant banks will shrug off its rate decision amidst the lingering challenges being faced by key global economies, Ms Ong added.

The central bank will also have to ponder on the promised surplus that Prime Minister Julia Gillard vowed she would include in the May 8 budget presentation, the radical modification of which could put off the next June cash rate reduction forecasted by many economists, analysts said.

To unleash a flurry of rate cuts within a short period of time would be extraordinary for the RBA, according to HSBC economist Paul Bloxham, given the bank's watchful monitoring of the inflation, which he noted was far more complicated beneath the surface.

One major cut sounds more possible, the HSBC analyst said, the reason for which is the relative calm being seen by the RBA in the local economy, which despite some weak signals in specific sectors is generally in the growth-mode due to the ongoing mining boom.

And any form of rate reduction should be within the realm of limits as set by the RBA board, Mr Bloxham stressed.

"It would also be highly unusual for the RBA to cut by more than 25 basis points unless there was an emergency, and we are currently far from that," Mr Bloxham told AAP.