The Reserve Bank of Australia (RBA) cut the official interest rate by 0.25% to a record low of 1.5% Tuesday in a bid to stimulate the labour market and economic growth. 
Overall economic growth was continuing at a moderate pace with low inflation of 1.1% despite a large decline in business investment, RBA Governor Glenn tevens said. 
"The Board judged that prospects for sustainable growth in the economy, with inflation returning to target over time, would be improved by easing monetary policy at this meeting," Stevens said in a statement. 
Other economic data released Tuesday showed a widening trade deficit and slumping building approvals that point to softer growth in the second quarter of the Australian financial year. 
The Bureau of Statistics reported a trade deficit of 3.2 billion Australian dollars (2.4 billion dollars) in June, up from 2.2 billion in May. The value of exports fell 1% in June largely due to the fall in prices for mineral exports, while the value of imports rose 2%.