At home the RBA released their December minutes, which revealed that the reason for the rate cut was a result of global financial market turbulence.
The central bank also said that it that it expects global economic growth to stall in the coming year.
The RBA bank also noted that Europe had been notably weaker and it remained unclear as to how the current situation would be resolved.
With such a clear emphasis being placed on Europe, and not much hope of the issue being cleared up in the coming months, there is a strong case for further rate cuts.
The big banks were mixed; ANZ recorded a 1.2% loss, whilst WBC achieved a 0.1% gain.
The miners were mainly weaker; BHP dropped 0.6% whilst Rio Tinto finished flat.
In the retail sector, Billabong continued its decline after yesterdays massive sell off, crashing another 12.8% amid a host of broker downgrades.
Cochlear was a big gainer on the market today, jumping 16.4% after announcing it had identified the cause of its recent implant failures.
The ASX 200 fell seven points (-0.2%), settling at 4053.