Bullock delivers ‘confident cut’ while staying alert to global shock

InvestorDaily

The Reserve Bank (RBA) eased the cash rate by 25 basis points to 3.85 per cent, marking its second reduction since the tightening cycle began in 2022. The move comes amid a sustained moderation in inflation and growing uncertainty in the global economic landscape. Governor Bullock described the decision as “a confident cut” and “the right decision at this point in time”, while cautioning that the path ahead remains uncertain.

Speaking after Tuesday’s board meeting, Bullock said the RBA weighed two options: holding or cutting. The case to stay on hold was “quickly ruled out”, she said, with the board also debating a larger 50 basis point cut. Ultimately, it settled on a 25-point move as the “appropriate” response for now. While global volatility dominated the backdrop, Bullock said domestic conditions had aligned in favour of a cut – albeit the labour market remains tight and productivity growth has not improved – noting the board’s decision “does not preclude further action in the future”.

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