The Reserve Bank of Australia has cut the cash rate to a record low 1.75 per cent in a bid to head off falling prices and an economic downturn.
The Australian dollar, which had risen solidly ahead of the decision, dropped like a stone, falling to US75.80¢ from US77.17¢ just before the decision was announced at 2.30pm AEDT.
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Mark Mulligan is the world editor and a former markets and economics writer. He was a Financial Times correspondent. Connect with Mark on Twitter. Email Mark at mark.mulligan@afr.com.au
