NAB, Macquarie further drop term deposit rates

The two have joined their big bank peers Commonwealth Bank and Westpac which both lowered their headline special offer rates last week after earlier rounds of significant cuts.

NAB has made across-the-board cuts to a raft of term deposit rates after an earlier round of cuts in August.

At that time, it had boosted its best rate by 80 basis points to 4.8% p.a. for amounts between $5,000 and $1,999,000 invested for eight-to-nine months with interest paid end of term.

But from Tuesday, that rate is down to 4.75% p.a. – a five-basis point cut – although it remains NAB’s best rate.

Big bank TD rates falling

It brings it in line with both CBA and Westpac’s best special offer rates of 4.75%.

CBA is offering the rate for the same amount invested for nine months with interest paid annually while Westpac will accept amounts between $5,000 and $5 million invested for 11 months with interest paid monthly or at maturity but only for online customers.

Those opening or renewing in Westpac branches will be docked 10 basis points and get 4.65% p.a.

Macquarie also goes lower

Macquarie still has the jump on its larger rivals, with its top headline rate at 4.95% p.a. for amounts less than $1 million invested for three months with interest paid at maturity.

Late Monday, it announced it was dropping its six, nine, and one year rates, as follows:

Its one- and two-month terms have also seen considerable boosts but still only pay 2.1% p.a.

TD market continues to plunge

The term deposit market has seen rates plummeting since August along with fixed home loan rates.

Although the Reserve Bank of Australia has not changed the cash rate since November 2023, retail banks are positioning themselves for where they see the market heading.

Many central banks in developed economies have begun cutting their benchmark rates, including the US, Canada, the UK, Europe, China, and New Zealand.

Australian banks and lenders are taking advantage of lower rates on global wholesale funding markets and are pricing their domestic retail customers accordingly.

Essentially, they are getting ahead of the game even though the cash rate in Australia has remained at 4.35% for 11 months.

Rates over 5% still around

The best term deposit rate on the market, according to the Savings.com.au database, is currently 5.10% p.a.

Several high interest savings accounts are offering higher rates of return, often as introductory or bonus offers.

Some high-interest products come with terms and conditions before their best rates apply so make sure you understand the fine print when you sign up.

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