RBA cuts rates by .25 basis points to 3%
The Reserve Bank of Australia (RBA) has cut the official cash rate by 25 basis points to 3.00 per cent, the lowest level since 1960.
Economists were divided over whether the central bank would leave rates on hold, or cut rates by as much as 50 basis points, following a board meeting earlier today.
Federal Treasurer Wayne Swan welcomed the move, which he said would help cushion the Australian economy from the global recession.
RBA governor Glenn Stevens said even though the amount of debt carried by households had been lowered considerably by previous rate cuts and fiscal policy measures from the government, the board had decided there was still scope for another rate cut.
"There has already been a major change in both monetary and fiscal policy in Australia. Market and mortgage rates are at very low levels by historical standards and business loan rates are below recent averages, reducing debt servicing burdens considerably," Mr Stevens said.
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