The Reserve Bank of Australia reduced their benchmark interest rate to 7.00% from a 12 year high of 7.25%, which was widely expected by market participants. A weakening labor market paired with stagnant growth has pushed the central bank to lower the interest rate for the first time since 2001. The RBA expects economic activity to remain subdued over the coming months, and said that there is “scope for credit conditions to become less restrictive.” Amid the downturn in growth, inflation remains well above the RBA’s comfort zone, which may lead the central bank to hold off on future rate cuts.