The Reserve Bank of Australia slashed the Official Cash Rate from 4.25% to 3.75%. The 50 basis point cut was more than the 25-bps cut the market has expected. In Glenn Steven’s (Governor of the RBA) statement, he mentioned slowdown in China as well as the challenge in the Eurozone. He also noted a slowing domestic economy despite a growth in demand...Also, the strong Aussie contributed to less competitive export prices and therefore limited growth. Finally, a big factor to the rate cut was due to the fact that inflation was held off. The rate cut being deeper than expected pressured the AUD/USD as it slid sharply ... (full story)