With just over three weeks of 2024 left to go, the Australian term deposit market looks to be cooling.
While the RBA kept the cash rate at 4.35% on Tuesday, a 'dovish pivot' in the accompanying statement saw market expectations on rate cuts shift.
As of 11 December, the ASX RBA rate tracker was pricing in a 78% probability the RBA board would hand down a rate cut at its next monetary policy meeting in February.
Accordingly, the general trend in the TD market is downwards – the biggest news this week was of Judo Bank cutting its strong returns.
However, a couple of providers hiked rates against the broader trend this week, including Bank of Sydney, which unveiled a new rate above 5% p.a.
Additionally, Thursday's labour force data showed unemployment unexpectedly declined in November, leaving the outlook for the cash rate as uncertain as ever.
Here were the major TD rate changes this week.
Judo cut rates by up to 10 bps
| Term length | Deposit size | Payment frequency | Rate (Change) |
|---|---|---|---|
| Three months | $1,000-$2,000,000 | End of term | 4.95% p.a. (-0.05) |
| Six months | $1,000-$2,000,000 | End of term | 5.05% p.a. (-0.10) |
| Two years | $1,000-$2,000,000 | End of term | 4.70% p.a. (-0.05) |
The headline from Judo's latest round of rate cuts is of the 0.10% cut to rates on its six month deposit product.
Judo has officially relinquished its position at the summit of the six month market – the 5.09% p.a. rate available at Heartland Bank moves to the top.
Judo also trimmed its previously market-leading three month rate although, at 4.95% p.a., it remains level with rates offered at the likes of Macquarie.
Bank of Sydney varied rates by up to 105 bps
| Term length | Deposit size | Payment frequency | Rate (Change) |
|---|---|---|---|
| Three months | $1,000-$1,000,000 | End of term | 3.50% p.a. (-1.50) |
| Nine months | $1,000-$1,000,000 | End of term | 5.05% p.a. (+0.40) |
This time last week both Judo and Bank of Sydney were offering 5.00% p.a. returns for three month deposits.
Now 4.95% p.a. is the highest available rate, meaning sleepless nights and anguish for any three month TD fans who put off locking in.
Bank of Sydney really did swing the axe, cutting its rate by 150 bps.
It still offers 5.10% p.a. on six month terms (online only), while it also boosted nine month rates up to 5.05% p.a.
Great Southern Bank varied rates by up to 25 bps
| Term length | Deposit size | Payment frequency | Rate (Change) |
|---|---|---|---|
| Three months | $5,000-$99,999,999 | End of term | 4.75% p.a. (+0.20) |
| Six months | $5,000-$99,999,999 | End of term | 4.35% p.a. (-0.10) |
| Eight months | $5,000-$99,999,999 | End of term | 4.70% p.a. (+0.25) |
| Eleven months | $5,000-$99,999,999 | End of term | 4.75% p.a. (+0.15) |
| One year | $5,000-$99,999,999 | End of term | 4.45% p.a. (+0.10) |
| One year Platinum Plus 55+ | $5,000-$99,999,999 | End of term | 4.55% p.a. (+0.10) |
Other movers
- IMB Bank cut one year TD rates by up to 10 bps, leaving its new top rate at 4.50% p.a.
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Looking for a fixed income investment? Check out some of the top term deposits in Australia
Provider | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| At Maturity | $product[$field["value"]] | $product[$field["value"]] | $product[$field["value"]] | 1000 | $product[$field["value"]] | $product[$field["value"]] | More details | ||||||
SMSF Term Deposit - 6 months | |||||||||||||
| At Maturity | $product[$field["value"]] | $product[$field["value"]] | $product[$field["value"]] | 25000 | $product[$field["value"]] | $product[$field["value"]] | More details | ||||||
Term Deposit - 6 months | |||||||||||||
| At Maturity | $product[$field["value"]] | $product[$field["value"]] | $product[$field["value"]] | 1000 | $product[$field["value"]] | $product[$field["value"]] | More details | ||||||
Term Deposits - 6 months | |||||||||||||
| At Maturity | $product[$field["value"]] | $product[$field["value"]] | $product[$field["value"]] | 25000 | $product[$field["value"]] | $product[$field["value"]] | More details | ||||||
Term Deposit ($25,000+) - 6 months | |||||||||||||
| At Maturity | $product[$field["value"]] | $product[$field["value"]] | $product[$field["value"]] | 5000 | $product[$field["value"]] | $product[$field["value"]] | More details | ||||||
Term Deposit - 6 months | |||||||||||||
| At Maturity | $product[$field["value"]] | $product[$field["value"]] | $product[$field["value"]] | 5000 | $product[$field["value"]] | $product[$field["value"]] | More details | ||||||
Macquarie Bank Term Deposit (<$1,000,000) - 6 months | |||||||||||||
Picture by Miles Burke on Unsplash
Harry O'Sullivan
Jacob Cocciolone
Brooke Cooper
