Once again, the RBA decided to keep the cash rate steady at 4.10%, leaving many to ponder if we have reached the peak.

Judo and Bank of Sydney, two providers that led the way for term deposit rates just a few weeks ago cut rates once again, bringing the market leading rates further away from the heights of 5.50% p.a.

On the other hand, several banks including NAB and ING hiked up term deposit rates despite the RBA's decision.

Even if the cash rate does not increase any further, it might be some time before it starts to get cut, so we might see term deposit returns stay strong for a while yet.

For example, Westpac chief economist Bill Evans does not forecast a rate cut until September 2024.

Bank of Sydney cuts rates by up to 110 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Two months $1,000-$1,000,000 End of term 1.75% p.a (-1.10)
Three months $1,000-$1,000,000 End of term 5.05% p.a (-0.15)
Five months $1,000-$1,000,000 End of term 4.00% p.a (-1.05)
Six months $1,000-$1,000,000 End of term 5.20% p.a (-0.15)

Last week, Bank of Sydney slashed rates on several term deposit products, and has done the same this week.

Two weeks ago, you could have locked in a 5.50% p.a return with Bank of Sydney's six month term deposits, but after two successive rate cuts, this product now returns 5.20% p.a. for new customers.

However, as other providers also slash rates, 5.20% p.a continues to be the highest available rate on the market for six month term deposits according to Savings.com.au's research.

Judo cuts rates by up to 15 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Three months $1,000-$999,999 End of term 4.85% p.a (-0.15)
Six months $1,000-$999,999 End of term 5.15% p.a (-0.15)
Nine months $1,000-$999,999 End of term 5.15% p.a (-0.05)
One year $1,000-$999,999 End of term 5.25% p.a (-0.10)

Judo has also cut rates consecutively after 10 basis point decreases last week.

For six month terms, the neobank is 5 basis points behind Bank of Sydney, while for one year terms it remains behind AMP, which is offering returns of 5.35% p.a or 5.40% p.a depending on deposit size.

ING increases rates by up to 25 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Three months $10,000-$5,000,000 End of term 4.95% p.a (+0.20)
Six months $10,000-$5,000,000 End of term 5.10% p.a (+0.15)
Nine months $10,000-$5,000,000 End of term 5.15% p.a (+0.20)
One year $10,000-$5,000,000 End of term 5.25% p.a (+0.25)
Two years $10,000-$5,000,000 End of term 5.10% p.a (+0.20)

The likes of Bank of Sydney and Judo cut rates at the same time some of the larger banks in Australia have chosen to start hiking.

ING has been missing from these term deposit wraps the past few weeks, but made big moves this week, hiking up returns on term lengths of six months or more to above 5% p.a.

ING is now level with Judo for one year term deposit returns.

AMP cuts rates by up to 20 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Three months $25,000-$4,999,999 End of term 5.05% p.a (-0.05)
Nine months $25,000-$4,999,999 End of term 5.25% p.a (-0.20)
One year $25,000-$4,999,999 End of term 5.40% p.a (-0.05)

AMP was the other big hitter to take its foot off the gas this week, cutting TD rates by up to 20 basis points.

It remains the market leader for one year term deposit products (as per Savings.com.au's market research).

There's a 5 basis point discount for deposits below $25,000, and 5, 10 and 20 point reductions for interest payments made semi annually, quarterly and monthly respectively.

NAB increases rates by up to 25 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Six/Seven months $5,000-$1,999,999 End of term 4.00% p.a (+0.20)
Eight/Nine months $5,000-$1,999,999 End of term 4.25% p.a (+0.25)
One year $5,000-$1,999,999 End of term 4.85% p.a (+0.10)

For the second week in a row, Australia's third largest bank hiked up term deposit rates.

NAB economist Tapas Strickland has been noticeably cautious about declaring the RBA's work as far as rate increases go is done, pointing out strong and sticky service price inflation.

NAB's most recent prediction was Australia would see two more cash rate increases, although this has yet to be updated after Tuesday's monetary policy call.

ANZ increase rates on Advance Notice term deposits by up to 30 basis points

Term length Deposit size Payment frequency Interest rate (Percentage point change)
Six to seven months $5,000-$99,999 End of term 4.10% p.a (+0.30)
Seven to eight months $5,000-$99,999 End of term 4.20% p.a (+0.20)
Eight to nine months $5,000-$99,999 End of term 4.25% p.a (+0.25)
One to two years $5,000-$99,999 End of term 4.85% p.a (+0.10)

ANZ was the other one of the big four to hike up term deposit rates this week, with increases of up to 30 basis points on its Advance notice products.

You need to give at least 30 days notice before you withdraw from the Advance notice term deposits.

This comes the day after the ACCC announced it would not be approving ANZ's proposed acquisition of Suncorp.

Other movers

  • MOVE increased rates by up to 35 basis points
  • Macquarie Bank varied rates by up to 10 basis points
  • Newcastle Permanent increased rates by up to 75 basis points, including a 5.20% p.a return on two year terms.
  • Greater Bank increased rates by up to 90 basis points, also offering a highest rate of 5.20% p.a on two year terms.