RBI may reduce policy rates by 50 basis points in the first half of 2025: Jefferies

The Reserve Bank of India (RBI) is expected to cut policy rates by 50 basis points in the first half of 2025 after easing liquidity and reducing the Cash Reserve Ratio (CRR). While the rate cuts may support growth, they could temporarily compress banks' Net Interest Margins (NIMs) and impact asset quality, especially for public sector banks and smaller lenders.