The record low cash rate risks reflating asset bubbles in shares, property and more speculative investments, as central banks around the world make a forceful return to policy easing to rescue growth.
The Reserve Bank of Australia's second consecutive rate cut takes the key rate to 1 per cent. It follows interest rate reductions this year from the Reserve Bank of New Zealand, Malaysia and Iceland. Sweden's central bank meets on Wednesday, and the US Federal Reserve is widely expected to bow to pressure to cut in 2019.
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Vesna Poljak is the Companies editor. She was previously the Markets editor with a special interest in the investment industry, hedge funds and accounting. She is based in the Sydney newsroom. Connect with Vesna on Twitter. Email Vesna at vpoljak@afr.com
