As expected the RBA cut rates for the first time since August 2016 to an all-time low of 1.25%.
Their reasoning is because growth has been slowing (to under 2%), inflation is negligible (1.3%), and they want to support employment growth.
Unemployment has been gradually tracking up from the 4.9% low seen in February to 5.2%.
The ASX has moved modestly higher on the news (+0.22%), and the AUD is little changed at just under 70c.
This comes at a time when bond market yields are at all time lows on risk aversion and capital preservation, yet stocks have touched 11year highs. The bond market is worried about Armageddon, and the stock market is business as usual. The uncanny relationship can be blamed on Central Bank action, with the ECB & BOJ still in stimulus mode.
The rate cut is good for business, exporters (weaker AUD), property owners, and any other borrower.
People relying on terms deposit income will be impacted slightly.