Australian central bank cuts rate 25 points to 3.5 percent

    The Reserve Bank of Australia cut its cash rate by 25 basis points to 3.50 percent, citing weaker growth in Europe and a moderation of growth in China, a major export market for Australia. The Australian central bank, which already cut its leading interest rate by 1/2 a percentage point last month, said the current economic trend was unclear and could be dampened by slower Chinese growth.

   "Europe's economic and financial prospects have again been clouded by weakening growth, heightened political uncertainty and concerns about fiscal sustainability and the strength of some banks," the bank said in a statement from its governor, Glenn Stevens. He added that domestic growth was modest and the outlook for inflation made it possible to ease monetary policy.

    The rate cut takes effect on June 6, 2012.


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