by Ryan McMaken
Earlier this week, the Reserve Bank of Australia, the country’s central bank, lowered its key interest rate from 2.0 percent to 1.75 percent, which is a record low.
Australia is about equal to the State of New York in terms of both population and the size of its economy, so it’s not an irrelevant economy, and the Australian bank’s latest move is just another example of the trend among the world’s advanced economies to push interest rates down to record lows.
Last month, New Zealand’s central bank also moved its target rate down to a record low of 2.25 percent. although New Zealand’s economy is much smaller than Australia’s — about equal to Kentucky’s economy — it’s just yet another high-income country where the central bank has intervened in what will be shown to be a vain attempt to prop up a stagnating economy.