The Reserve Bank of Australia (RBA) has cut the country's official cash rate to its lowest point since the depths of the global financial crisis in 2008. Governor Glenn Stevens announced the 25 per cent cut last Tuesday, bringing the rate to 3.0 per cent.

 

In his statement, Mr Stevens said the decision to cut the cash rate had been informed by global economic growth uncertainty, saying that there are still significant influences that are contributing to the pessimistic global outlook, including the situation in Europe.

 

Mr Stevens also cited the uncertainty of figures coming out of the US and restrained growth in Asia, specifically China, for the Board's decision.

 

Domestically, the Governor said that growth has remained close to trend over the past year, spurred on by unprecedented investment in capital spending in the resources sector, while other sectors have experienced weaker conditions.

 

Mr Stevens also took the opportunity to warn that peak investment in resources capital is fast approaching, which he said will allow more scope for demand in other sectors.