The Reserve Bank of Australia cut the official cash rate Tuesday by 25 basis points to a historic low of 1.75%.

    It is the first cut in interest rates for 12 months and comes after inflation fell below the bank's preferred level of between 2% and 3%.

    In a statement, the bank's governor Glenn Stevens said uncertainty about the global economic outlook continued, according to the (dpa). "In Australia, the available information suggests that the economy is continuing to rebalance following the mining investment boom," Stevens said. 

    Prospects for sustainable growth in the economy would be improved with a stimulus for borrowing at this time, he said