Considering the last rate cut was 18 months ago and economic conditions don't look flash, a 25bp cut is hardly alarmist.
Put in perspective, the RBA still has a full 9 more cuts available to them (based on a normal 25bp cut).
That's still heaps in the tank in comparison to therest of the worlds main economies.
If we hit zero, then the world is in the toilet .....period
True.
Its just the new norm, at least for the medium term. Cash rates at 6%+ won't be around for the medium term - unless there are some serious drivers of growth/prices that come from somewhere unexpected.
Also, central banks around the world have shown that you can continue to use monetary policy to stimulate the economy beyond the zero lower bound (UMP). The risks are greater sure, but can be used in emergency situations to stimulate activity/risk taking.
Cheers,
Redom