CANBERRA, Australia -- Australia's central bank on Tuesday cut its benchmark interest rate by 0.15 of a percentage point to a record low 0.10% in a bid to lift the economy from a pandemic-induced recession.
The move was the first since March when the Reserve Bank of Australia board made two cuts of a quarter of a percentage point each two weeks apart.
The Reserve Bank also announced that it would buy $70 billion of government bonds of maturities of around five-to-10 years over the next six months.
The bank is prepared to buy bonds in whatever quantity is required to achieve a three-year yield target of 0.1%, Reserve Bank governor Philip Lowe said in a statement.
"With Australia facing a period of high unemployment, the Reserve Bank is committed to doing what it can to support the creation of jobs," Lowe said.
Recent economic data has been better than expected and the near-term outlook was better than it was three months ago, he said.
"Even so, the recovery is still expected to be bumpy and drawn out and the outlook remains dependent on successful containment of the virus," he added.
Output in most countries remains well short of pre-pandemic levels and recent virus outbreaks pose a downside risk to the outlook, particularly in Europe, Lowe said.
Most major economies have slashed interest rates to near record low levels and deployed large central bank stimulus to help their economies weather the coronavirus pandemic.
The Australian economy contracted during the first half of the calendar year, although Lowe said the economy had "increased solidly" during the September quarter. Official data for the quarter has yet to be released.