Most economists are expecting the RBA to once again hold rates steady at 4.10% p.a next Tuesday, although CPI inflation rose for the first time in several months in August.

Rate cuts aren't expected until deep in 2024 though, and CommBank economists, who had previously penciled in March next year for the first cut, pushed that prediction back to May after the ABS revealed the CPI indicator.

With the high rate period set to continue for a while yet, Bank of Sydney has reported a surge in investors looking for the security and guaranteed returns offered by term deposits.

This could at least partly explain the flip flopping Bank of Sydney, and some other term deposit providers, have done in the past few weeks, once again increasing term deposit returns despite not much substantial change in the economic outlook.

For the third week in a row, Bank of Sydney increased rates this week, along with the likes of Macquarie, Judo and Bank of Queensland.

It wasn't all upward traffic though, with ING and Bank Australia among those to cut rates.

ING cuts rates by up to 30 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Three months $10,000-$5,000,000 End of term 4.65% p.a (-0.05)
Six months $10,000-$5,000,000 End of term 4.80% p.a (-0.15)
Nine months $10,000-$5,000,000 End of term 4.80% p.a (-0.15)
One year $10,000-$5,000,000 End of term 5.00% p.a (-0.05)

ING was one of the largest institutions to change term deposit rates this week, cutting back returns across its range of products.

Even after a five basis point cut, its one year term deposits still return 5% p.a, which has become something of a threshold for the stronger players.

Compared to what's on offer at the big four and the other largest banks in Australia, ING's range of term deposit products is still relatively strong.

Bank Australia cuts rates by up to 20 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Six months $500-$1,000,000 End of term 4.95% p.a (-0.05)
Six months $500-$1,000,000 Monthly 4.85% p.a (-0.05)
One year $500-$1,000,000 End of term 5.05% p.a (-0.20)
One year $500-$1,000,000 Monthly 4.95% p.a (-0.20)

Bank Australia was one of the other banks to decrease rates this week, but like ING, continue to offer rates above 5% p.a on one year term deposits in spite of these cuts.

It also increased some home loan rates by 10 basis points this week.

Bank of Sydney increases rates up to 15 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Nine months $1,000-$1,000,000 End of term 5.05% p.a (+0.15)
One year $1,000-$1,000,000 End of term 5.25% p.a (+0.10)

It's not quite the 5.50% p.a that was on offer a few months ago, but Bank of Sydney is well and truly back among the premier term deposit providers in Australia after a third successive week of rate increases.

There was a long period of rate cuts at Bank of Sydney, but the bank has since shifted approach once more, calling the surge in investor interest in term deposit products "remarkable" earlier today.

Chief Banking Officer Fawaz Sankari said while increased repayments for mortgage repayments dominate the headlines, high interest rates are a great opportunity for people looking to save.

"Australians...are now witnessing a tide of enhanced returns from their savings," Mr Sankari said.

"This paradigm shift is redefining the appeal of term deposits."

Macquarie Bank increases rates by up to 10 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Six months $5,000-$1,000,000 End of term 4.75% p.a (+0.05)
One year $5,000-$1,000,000 End of term 4.90% p.a (+0.10)

ME increases rates by up to 10 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Seven/eight months $5,000-$2,000,000 End of term 4.95% p.a (+0.10)
One year to eighteen months $5,000-$2,000,000 End of term 5.00% p.a (+0.05)

Back in June, ME was the first bank to crack 5% p.a for one year term deposit rates.

When it cut rates back below that mark at the end of August, I declared it a watershed moment marking the beginning of the end for what's been a golden era for term deposit rates in Australia, but that looks to have been premature.

ME is now back among the 5% club after a 5 basis point increase, and its seven/eight month products are also now just 5 basis points away from shaking the 4 at the start of the rate.

Judo increases rates by up to 25 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Three months $1,000-$999,999 End of term 4.75% p.a (+0.05)
Six months $1,000-$999,999 End of term 5.00% p.a (+0.05)
Nine months $1,000-$999,999 End of term 5.00% p.a (+0.05)
One year $1,000-$999,999 End of term 5.25% p.a (+0.25)
Two years $1,000-$999,999 End of term 5.25% p.a (+0.15)

Another one of the previous market leaders back with a vengeance, Judo pushed up rates this week, so all term lengths of six months or more return at least 5% p.a.

For one year terms, Judo now offers 5.25% p.a, level with Bank of Sydney and among the market leading rates for the nation, per savings.com.au's research.

Bank of Queensland increase rates by 10 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Six months $5,000-$250,000 End of term 4.80% p.a (+0.10)
Six months $5,000-$250,000 Monthly 4.70% p.a (+0.10)
Nine months $5,000-$250,000 End of term 4.90% p.a (+0.10)
Nine months $5,000-$250,000 Monthly 4.80% p.a (+0.10)

Other movers

  • Summerland Credit Union varied rates by up to 110 basis points, including a two year term that now returns 5% p.a
  • Northern Inland Credit Union decreased rates by up to 15 basis points
  • MyState decreased rates by up to 20 basis points