Aust dollar jumps on rate cut

Local currency rallies in the face of a 25 basis rate cut

The Australian dollar rose sharply after the Reserve Bank of Australia cut the cash rate by 25 basis points to a new record low of 2.5%. 

At 1428 AEST on Tuesday, two minutes before the release of the central bank's decision, the local unit was trading at 89.24 US cents, up from 89.09 cents on Monday.

At 1433 AEST, the local unit had jumped to 89.66 US cents.