Australia's central bank cut interest rates to a new record low Tuesday in a widely expected decision after a recent run of soft inflation readings.

The 25 basis points cut to 1.5 percent means the Reserve Bank of Australia has slashed rates by 300 basis points since November 2011 to support the economy as it transitions towards non-resources growth after an unprecedented mining investment boom.

"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," bank governor Glenn Stevens said in a statement.