RBA slashes rates to five-year low

The Reserve Bank of Australia on Tuesday shocked markets with a sharper-than-expected rate cut of 75 basis points.

Analysts had expected a 50 basis-point loosening and the region's equity markets climbed on the news. The Nikkei 225 index of leading shares listed in Tokyo finished the day up 6.3% at a two-week high of 9,115, partly on the back of the rate action.

The move leaves the benchmark cash rate at 5.25%, the lowest level since December 2003.

"The size of the move underscores that while