More banks slash term deposit rates as markets bet on RBA rate cut

Earlier this week, NAB cut term deposit rates by up to 20 basis points; this came at the heels of CommBank's move to slash TD rates last week.

Now, Westpac and ANZ have joined the cutting party, with Westpac bringing in the rear cutting rates on Friday afternoon. 

This was to be expected from these big banks as they usually follow each other's moves.

These cuts affirm the major banks' forecasts that the RBA will begin easing its monetary policy this February.

Markets are fully priced the RBA Board will vote for the cash rate to be lowered from its current peak of 4.35% down to 4.10%.

As of 13 February, 90% of ASX traders expect the next decision to be announced at 65 Martin Place will be a 25 basis point cut to Australia's benchmark rate.

The odds that a rate cut is just around the corner increased when the ABS reported that underlying inflation in December quarter came in below the RBA's expectations.

Although the probability of another hold remains present considering the labour market is still strong and discretionary spending was up in 2024, these banks have already gone ahead to drop term deposit rates.

Westpac takes the froth off special offer rate

Just a five basis point haircut on 11-month terms from Australia's second-largest bank this week, which is relatively minor compared to its big bank peers.

The rate is now 4.60% p.a. and what's notable is the rate is the same whether one chooses at-maturity or monthly payments. 

The minimum deposit is $5,000 while the maximum is $5 million.

With just a 5 basis point cut this still leaves Westpac with some of the strongest rates among its major bank compadres. 

ANZ cuts term deposit rates up to 20 basis points

ANZ dropped the axe on its Advanced Notice term deposit products, including those on terms as short as three months to as long as two years.

The last time the bank adjusted term deposit rates was in early October 2024.

Shedding 15 basis points this week has brought its top rate down to 4.60% p.a., available through the 8-month term deposit paying interest at maturity.

Depositors who prefer more frequent interest payouts will get a much lower rate, starting at 4.54% p.a.

This rate is available for new and existing customers with at least a $5,000 deposit.

Term	New rate (change)	Payment frequency
3 Months	3.00% p.a. (-15 bps)	End of term
3 Months	2.99% p.a. (-15 bps)	Monthly
6 Months	3.40% p.a. (-10 bps)	End of term
6 Months	3.38% p.a. (-9 bps)	Monthly
8 Months	4.60% p.a. (-15 bps)	End of term
8 Months	4.54% p.a. (-15 bps)	Monthly
9 Months	3.60% p.a. (-20 bps)	End of term
9 Months	3.56% p.a. (-19 bps)	Monthly
24 Months	3.75% p.a. (-5 bps)	End of term
24 Months	3.69% p.a. (-5 bps)	Monthly

Advance Notice term depositors who need to withdraw funds before the end of the term are required to provide 31 days' notice, pay a fee, and take a reduction on their interest earned.

This is pretty standard across the board, however ANZ offers another product that does not require such a notice period, albeit at much lower interest rates. 

Macquarie Bank sheds 5 bps from term deposits

Macquarie Bank is back on the chopping block this week to slash 5 basis points off its term deposit rates.

From offering market-leading rates on select terms, Australia's fifth-largest bank has gradually stepped down from the podium after a series of 5-10 basis point cuts since late last year.

Macquarie Bank's current top rate is 4.60% p.a. for three months.

That's 35 basis points below the current market leader in the 3-month space, RACQ Bank.

Here are the new rates of Macquarie's TDs, with deposit sizes starting at $5,000 up to $1 million; interest is payable at maturity.

Term	New rate (change)
3 Months	4.60% p.a. (-5 bps)
6 Months	4.50% p.a. (-5 bps)
9 Months	4.40% p.a. (-5 bps)
12 Months	4.35% p.a. (-5 bps)

AMP Bank adjusts term deposit rates

AMP Bank also made a flurry of cuts across its range of term deposit products.

Up to 15 basis points were shaved off TD rates this week, leaving its top rate at 4.85% p.a. for deposits $25,000 to $10 million locked away for five months.

Customers with $5,000 to $24,999 will get 4.80% p.a. for the same term.

These adjustments came after AMP Bank boosted the same term deposit product less than two weeks ago.

Here are some of the rates on the popular terms paying interest at maturity.

Term	New rate (change)	Deposit size
3 Months	4.80% p.a. (-5 bps)	$5,000 - $24,999
6 Months	4.80% p.a. (-5 bps)	$5,000 - $24,999
9 Months	4.60% p.a. (-10 bps)	$5,000 - $24,999
12 Months	4.55% p.a. (-15 bps)	$5,000 - $24,999
3 Months	4.85% p.a. (-5 bps)	$25,000 - $10,000,000
6 Months	4.80% p.a. (-10 bps)	$25,000 - $10,000,000
9 Months	4.65% p.a. (-10 bps)	$25,000 - $10,000,000
12 Months	4.60% p.a. (-15 bps)	$25,000 - $10,000,000

In between the cuts this week, AMP Bank hiked the rate on its two-year term deposit by a hefty 190 basis points.

Depositors willing to lock away at least $5,000 in the bank for the said term will receive 4.05% p.a. with interest earnings paid monthly.

Suncorp Bank slashes long-term deposit rates

Suncorp Bank joined in on the rate-cutting action this week, focusing on long-term deposit products.

Suncorp shed as much as 35 basis points from TD rates on four- to five-year terms, signalling that the bank may be expecting interest rates to fall.

In a stable or falling rate environment, banks typically cut rates on long-term deposits.

Depositors with at least $1,000,000 can realise 3.80% p.a. earnings in interest, paid annually.

Smaller deposits, starting at $5,000, will earn 3.70% p.a. paid every year.

Judo Bank trims term deposit rates

Judo Bank has returned this week with another round of cuts on term deposit rates as it moves further away from other TD providers still offering 5% p.a.

Deposits on 6-month terms now earn 4.75% p.a. after the neobank shaved off 10 basis points.

Just a few months ago, Judo Bank dominated the 6-month term deposit space, offering the highest returns for depositors with at least $1,000.

The current market leader is Australian Military Bank, with 5.10% p.a. for six months.

Here are the newly unveiled rates of Judo Bank's term deposits paying interest monthly.

Term	New rate (change)
6 Months	4.75% p.a. (-10 bps)
9 Months	4.65% p.a. (-15 bps)
12 Months	4.60% p.a. (-15 bps)
24 Months	4.50% p.a. (-10 bps)
36 Months	4.40% p.a. (-10 bps)

Other movers:

• Beyond Bank cuts term deposit rates up to 20 basis points.
• ME Bank trims as much as 275 basis points from TD rates, bringing 9-month term deposit rate down to 2.00% p.a.
• Bank of us slashes term deposit rates up to 20 basis points; hikes 3-month TD by 80 bps.
• Arab Bank Australia lowers term deposit rates by as much as 25 basis points.

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