The Reserve Bank of Australia has cut the cash rate to a new record low of 1.25 per cent and has hinted at another move if the jobs market does not improve soon.
The central bank's first move in any direction since August 2016 followed another month of weak economic data, most notably an unexpected rise in the unemployment rate for April to 5.2 per cent.
RBA Governor Philip Lowe, who last month admitted a rate cut was on the table ahead after the board held fast amid the federal election campaign, said Tuesday's move should help speed a reduction in the jobless rate.
"It will assist with faster progress in reducing unemployment and achieve more assured progress towards the inflation target," Dr Lowe said in a statement.
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