RBA Cuts Official Cash Rate to Record Low of 0.75% - Quick Synopsis

The Reserve Bank of Australia just cut the Cash Rate Target by 0.25% to 0.75% - this is a new record low.

The pertinent points in the RBA’s accompanying statement were:  

• The board decided to lower the Cash Rate by 0.25% to 0.75%

• It is reasonable for investors to expect extended period of low rates

• The outlook for the global economy is reasonable, risks tilted to downside

• Will ease further if needed to support growth and meet inflation target

• A gentle economic turning point appears to have been reached

• The RBA's outlook is supported by low interest rates, tax cuts, infrastructure spending, signs of stabilisation in the housing market

• The consumption outlook remains domestic uncertainty

• The RBA made the decision to lower rates further today to support employment and income growth

• Forward-looking indicators of labour demand indicate that employment growth is likely to slow from its recent fast rate

• The economy still has reserve capacity

• Australian economy can sustain lower rates of unemployment and underemployment

• Board also took into account the forces leading to the trend to lower interest rates global

• The AUD is at its lowest levels in recent years

• North headline and underlying inflation expected to be under 2% over 2020 and a little over in 2021

• Credit conditions, especially for small and medium-sized businesses remain tight

Current indicative levels are:

AUD-USD        0.6720 / 0.6745
AUD-EUR         0.6165 / 0.6190
AUD-GBP        0.5465 / 0.5490
AUD-JPY            72.70 / 72.95
AUD-NZD        1.0760 / 1.0795

The next RBA Cash Rate policy meeting will be held on Tuesday 5th November 2019 (Melbourne Cup Day).

View the RBA’s Media Release

Please get in touch with us for more information or pricing