Few central bankers in modern history have had a better run than Australia's Glenn Stevens. He steered his country around the global financial crisis, drove its currency to record highs and extended its recession-free run past the two-decade mark.

That's all in jeopardy now, however, as Stevens, governor of the Reserve Bank of Australia, stands still while China's slowdown and deflationary forces close in. Markets are registering their disappointment by driving the Aussie dollar below 80 US cents for the first time since 2009. The message from traders: It's time for a rate cut. The question is, will Stevens act ahead of, or at, the central bank's February 3 policy meeting?

Under pressure: Glenn Stevens. Credit:Rob Homer

The odds he will are rising, but remain too low for comfort. The European Central Bank's quantitative-easing program and the Bank of Canada's surprise rate cut add to the pressure on Stevens to trim a benchmark rate he's held at 2.5 per cent for 17 months.

The most immediate danger is China, to which commodity-rich Australia has increasingly hitched its fortunes. The collapse in global commodity prices challenges Beijing's claim that its economy is growing by 7.3 per cent. Even more than the plunge in crude oil, iron ore at its lowest price in more than five years suggests China is growing slower. Such metals fuel the Chinese urbanisation trend that's been lifting world growth. As Premier Li Keqiang explained at Davos this week, China's move to a consumer-led economy from an investment-led one is real, and the fallout will be felt everywhere. China's "new normal" is particularly bad news for Australia's mining industry.