Australia Cuts Interest Rate to 3.6% Amid Easing Inflation

Australia's central bank cut its policy rate by 25 basis points to 3.6%, the lowest since April 2023, citing low inflation and slowing economic growth. Inflation has dropped substantially to 2.1%, near the Reserve Bank of Australia's target range, allowing some monetary easing despite restrictive financial conditions for households. The Australian economy's growth slowed to 1.3% year-on-year in the first quarter, impacted by weaker public spending, consumer demand, and exports, alongside the new U.S. tariffs imposed by President Donald Trump. Meanwhile, a by-election will be held in Kiama, NSW, on September 13 to replace former Liberal MP Gareth Ward, who resigned following a guilty verdict on sexual abuse charges and is appealing the convictions. Financial markets saw declines in U.S. Treasury yields, with the 30-year yield falling slightly but remaining elevated compared to last year, reflecting ongoing adjustments in global bond markets. These developments illustrate a complex interplay of domestic economic policy, political shifts, and international trade tensions shaping Australia's economic landscape.