Australia cuts its benchmark interest rate to record low + MORE Feb 3rd

SYDNEY – Australia’s central bank cut its benchmark interest rate to a record low of 2.25 per cent on Tuesday in a bid to jolt an economy weighed down by falling commodity prices.
The Reserve Bank of Australia’s quarter percentage point rate cut at a monthly board meeting was its first since August 2013. It came as a surprise to many economists, who expected the bank to hold off on lowering the rate until later in the year. Subdued inflation, however, has given the central bank more scope to stimulate Australia’s $1 trillion economy.
The news shook the Australian dollar which dropped 1.8 per cent 76.5 cents. The stock market was boosted, with the S&P/ASX 200 up 1.5 per cent.
Resource-rich Australia managed to avoid a recession during the global financial crisis thanks to a decade-long mining boom. But with the economy weakening in China, which is Australia’s largest export market, prices for commodities such as iron ore and coal have dropped.
Australia’s move follows monetary easing steps by other central banks though is modest compared with the unprecedented stimulus programs that Japan and Europe have embarked on to revive long stagnant economies…

TOKYO – The killing of two Japanese taken hostage by the Islamic State group has violently driven home the high stakes Japan faces and limited options it can muster in such circumstances.
It also offers a glimpse into how Japan is struggling to handle the rising menace of terrorism.
Until this crisis, Japan had not become directly embroiled in the fight against the militants, who now control about a third of both Syria and neighbouring Iraq in a self-declared caliphate. Tokyo’s backing for U.S.-led air strikes against the Islamic State group is confined to financial and humanitarian aid for refugees and other non-military support for countries affected by the conflict.
That proved no hindrance for the jihadis, and Japan is re-examining its response to the threat, both abroad and at home, mindful also of Tokyo’s preparations for the 2020 Olympic Games.
Government spokesman Yoshihide Suga said Tuesday that the government convened a meeting on counterterrorism to review the situation…

SYDNEY, Australia – Australia’s central bank cut its benchmark interest rate to a record low of 2.25 per cent on Tuesday in a bid to jolt an economy weighed down by falling commodity prices.
The Reserve Bank of Australia’s quarter percentage point rate cut at a monthly board meeting was its first since August 2013 and came as a surprise to many economists, who expected the bank to hold off on lowering the rate until later in the year.
The news shook the Australian dollar which dropped 1.8 per cent 76.5 cents. The stock market was boosted, with the S&P/ASX 200 up 1.3 per cent.
Resource-rich Australia managed to avoid a recession during the global financial crisis thanks to a decade-long mining boom. But with the economy weakening in China, which is Australia’s largest export market, prices for commodities such as iron ore and coal have dropped.
In a statement, the central bank’s governor Glenn Stevens pointed out that commodity prices have continued to decline, “in some cases sharply,” particularly oil…

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