Australian interest rates cut to record low

<p>The RBA announced it is cutting interest rates.</p>

Interest rates have been cut to a new record low by the Reserve Bank of Australia (RBA).

It was announced by the body that the cash rate is being cut from three per cent to 2.75 per cent and the change comes into effect from tomorrow (May 8th).

In a statement, Glenn Stevens revealed growth in Australia has been below trend for the last 12 months and the move to drop interest rates is intended to stimulate the country's economy.

He explained that the board of the RBA "judged that a further decline in the cash rate was appropriate to encourage sustainable growth in the economy, consistent with achieving the inflation target".

Mr Stevens added the RBA is expecting inflation to remain at a steady level in the near future.

Earlier in the month, the European Central Bank announced that it is cutting interest rates from 0.75 per cent to 0.5 per cent, which is a new low for Europe.

Find out about commodities trading and learn CFD strategies at City Index

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.