RBA interest rates: Reserve Bank of Australia cuts cash rate to 3.85% amid lowering inflation

Michele Bullock says she does not expect Australia to fall into recession, but the bank is wary of economic conditions deteriorating

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The Reserve Bank of Australia has cut the cash rate by a quarter point to 3.85%, easing pressure on mortgage holders grappling with high living costs and elevated interest repayments.

Economists view the RBA decision as a sign that Australia's central bankers believe inflation is being tamed and that there is no longer a need for a borrowing rate over 4% to constrain households, especially as Donald Trump's tariffs cast a shadow over the global economy.

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