Australia's Reserve Bank cuts official interest rate

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It is the fourth month in a row that the RBA has decided to cut the official interest rate. [ABC]

Last Updated: Tue, 2 Dec 2008 15:11:00 +1100

Australia's central bank, the Reserve, has announced it's lowering the official interest rate by one-percentage-point.

Two of the country's big banks - the Commonwealth and the National Australia banks - immediately announced cuts to their standard variable mortgage rates, by the full percentage-point.

But another big bank - Westpac - will only lower its rates by point-eight-of-a-percentage-point.

Australian Treasurer Wayne Swan has welcomed the cut, saying it's substantial relief for mortgage holders.

"This is a vital rate cut from the Reserve Bank, delivered at a time where all our joint efforts are directed towards strengthening the economy and protecting Australian jobs and for these reasons the Government does expect the banks to pass this on in full," he said.