Reserve Bank of Australia

PHOTO: Reserve Bank of Australia governor Philip Lowe has now cut the rate four times since June. Picture: AAP Image/Mick Tsikas Source: AAP

Australia’s central bank has responded to the escalating spread of the deadly coronavirus, cutting the official cash rate to a historic level.

The cash rate has fallen further into uncharted territory after it was slashed to 0.50 per cent by the Reserve Bank of Australia this afternoon.

The 25 basis point cut at the March policy meeting sets a fresh record low following three previous reductions in June, July and October.

Economists and analysts had expected central bank governor Philip Lowe to hold the rate until a recent spike in coronavirus cases wiped trillions of dollars off global share markets.

Last week, the S&P 500 on Wall Street experienced its worst week since the global financial crisis with more than $US6 trillion in value lost, while the ASX plunged further at the opening of trade on Monday.