After increasing its benchmark interest rate for the second time in nearly a month, Australia has become the first country to have revised the borrowing costs two times in the current year as global economy has started to show signs of recovery. The rate of interest has been increased almost overnight from an earlier figure of 3.25% to 3.5%.

Glenn Stevens, Reserve Bank Governor, raised the interest rate in Sydney today, a decision which is in tune with the predication made by 18 out of the 22 economists interviewed by Bloomberg News.

"Today’s move strikes a nice balance, it edges the cash rate back to more normal levels without threatening the economic recovery", said Craig James, a senior economist at Commonwealth Bank of Australia. “It is far from certain that rates will rise again in December”.

Post the announcement, the rate of the Australian Dollar fell to 90.15 US cents from an earlier figure of 90.88 cents. Also, a drop of 17 basis points, to 4.56%, was recorded for the two-year Government bond yield.

The revised interest rates will come into effort starting Monday.