SYDNEY, Oct. 1 (Xinhua) -- In the face of a domestic slowdown and continued international uncertainty, Australian central bank has cut the nation's cash rate for the third time this year, to a new record low of just 0.75 percent.
Citing issues such as Australia's ongoing drought, soft wage growth and weak consumer spending, Reserve Bank of Australia (RBA) governor Philip Lowe said on Tuesday that U.S.-China trade tensions have also been a major factor in "today's announcement."
"While the outlook for the global economy remains reasonable, the risks are tilted to the downside," he said.
"The U.S.-China trade and technology disputes are affecting international trade flows and investment as businesses scale back spending plans because of the increased uncertainty."
"At the same time, in most advanced economies, unemployment rates are low and wages growth has picked up, although inflation remains low."
Hindered by sluggish international trade growth over the past 12 months, Australia's GDP rose by just 1.4 percent during the financial year to June 2019.
According to the RBA board, this weakness in trade has also flowed through to Australia's factory output, essentially putting the brakes on the nation's industrial production levels.
While Lowe stated that he believes Australia's economy is likely to improve over the coming months with "recent tax cuts, ongoing spending on infrastructure, signs of stabilization in some established housing markets, and a brighter outlook for the resources sector," he also added, "it's reasonable to expect that an extended period of low interest rates will be required in Australia to reach full employment and achieve the inflation target." Enditem
