Australia's central bank cut its main cash rate by a quarter point to a record low of 2.5 percent on Tuesday as it tries to prepare the economy for life after the mining boom.

This was the eighth move in an easing cycle that began back in November 2011 and takes rates below the depths hit during the global financial crisis.

In large part, Australia is a victim of its own good fortune. Its embarrassment of natural resources were just what China needed to fuel its growth miracle, leading to a truly massive boom in mining.

An office worker walks past the Reserve Bank of Australia (RBA) building in central Sydney April 2, 2013.

As a result, mining investment has quadrupled as a share of the Australian economy but now looks to have peaked. Having risen so rapidly the risk is that spending could fall quite sharply from quarter to quarter, taking chunks out of economic growth.

The prospect of lower rates has dragged the Australian dollar down over 15 percent against its U.S. counterpart since April. On Tuesday, the currency was at $0.8950, having hit a three-year low on Monday.

The long run-up in mining investment is also lifting export volumes, a trend that has years to run. Figures out Tuesday showed the country boasted a trade surplus of A$602 million in June, the fifth straight month of surpluses.

Lower mortgage rates are also feeding though to the housing market. The Australian Bureau of Statistics reported house prices jumped 2.4 percent in the second quarter, the biggest gain in over three years.

(Source: Reuters)