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

. 1 min read

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

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