Reserve Bank cuts interest rate to 2.0% for May

The Reserve Bank of Australia (RBA) has cut the official cash rate by 25 basis points to 2.0% at its May meeting.

Many expected the RBA's decision after it kept rates on hold for April. The move was anticipated by AMP Capital head of Investment Strategy and chief economist Shane Oliver among others.

According to comparison website Finder's Michelle Hutchison, borrowers with a variable rate home loan are likely to save around $47 a month on a $300,000 loan with the new official cash rate.