Why did the RBA cut rates?

Today, Australia’s Reserve Bank (RBA) cut interest rates by 25 basis points down to a new record low of 2.75%.

I believe that central banks always take their interest rate policy too far in either direction

Do you wonder why they make such moves, especially as they near these extremes?

Did the RBA cut rates to…..

  • lower the value of the Australian Dollar (trying to make it competitive versus other currencies)
  • stimulate growth in the economy (if so, how bad is the economy?)
  • to provide relief to borrowers and credit card abusers
  • to help government (funnily as it’s one week before the federal budget)
  • to force “savers” to invest (because now, after inflation, they are really earning negative interest rates)

I’m simply wondering what was their reason beyond their official statement.

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