RBA cuts to 1.75% as data disappoints
Glenn Stevens points to “unexpectedly low” inflation data from first quarter
The Reserve Bank of Australia (RBA) cut its policy rate by 25bp to 1.75% today (May 3), citing "lower than expected" inflationary pressures.
Annual CPI inflation slipped to 1.3% at the end of the first quarter, down from 1.7% at the end of 2015, while core inflation dropped to 1.7% over the same period.
The data, released last month, prompted market speculation of a cut. It appears the decision was still something of a surprise, with the Australian dollar tumbling almost 2% against the US dollar
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