Cowen had taken view that there was an onus on the government to prioritize its work towards a stable banking system rather than divert resources into an investigation into how the largest financial institutions in Ireland were brought to the brink of collapse.
But the Labor Party accused Cowen of being the only political figure in the country against an inquiry.
Labor leader Eamon Gilmore claimed that Cowen seemed intent on applying the "30-year rule" on the release of government papers to the banking crisis.
Speaking to reporters in Dublin, Cowen said an inquiry would not happen until the new toxic debt agency, the National Assets Management Agency or NAMA, had started its work.
"We are emphasizing as a government, as we must, that the priority for the moment must be to solve the problem and then dealing with the sources of the issues that arose," he said.
In response to criticism and pressure, however, Cowen is now moving towards announcing a timeframe and mechanism for an inquiry. Reports have indicated that finance Minister Brian Lenihan is supportive of such moves.
Labor's Gilmore said his party would be putting forward a parliamentary motion calling for an inquiry, as well as a Private Members' Bill in the D
