Savers have had few reasons to celebrate in recent months, with term deposit rates racing to the bottom of the pit since bond yields started falling in mid-2024.
This recent decline was influenced by moderating inflation expectations, with investors placing bets on the RBA finally cutting interest rates.
This is despite the RBA maintaining a hawkish stance (before the recent dovish shift) and refusing to rule anything out.
However, Australian bond yields have been picking up, and some TD providers - like Judo Bank last week - are quick on the draw, hiking interest rates once more.
But it's not all good news (it never is), as others took their term deposit rates to the sword.
Macquarie Bank boosts term deposit rates
| Term | New rate (change) |
|---|---|
| 9 Months | 4.80% p.a. (+20 bps) |
| 12 Months | 4.80% p.a. (+20 bps) |
Macquarie Bank has been shaking up the retail banking space in the past few days - hiking its savings account rate (then its introductory rate).
It also sent a strong signal to the market, also hiking its fixed-rate home loans.
And it has never been one to sleep on its term deposit products.
This week, Australia's fifth-largest bank upped the rates on 9- and 12-month terms by 20 basis points, levelling them with its popular 6-month term which pays 4.80% p.a. at maturity.
Macquarie's current top rate is carried by its 3-month TD, at 4.95% p.a.
These rates apply to deposits ranging from $5,000 to $1 million.
Heartland Bank returns to the 5% club
| Term | New rate (change) |
|---|---|
| 6 Months | 4.99% p.a. (+10 bps) |
| 9 Months | 5.05% p.a. (+10 bps) |
| 1 Year | 5.00% p.a. (+10 bps) |
| 2 Years | 4.65% p.a. (+10 bps) |
| 3 Years | 4.55% p.a. (+20 bps) |
After exiting the floor it dominated for a few weeks and dropping rates below 5%, Heartland Bank returns, offering its best rate, 5.05% p.a., through its 9-month terms.
Depositors who prefer locking their money a bit longer can still get a 5% p.a. rate.
Meanwhile, those on shorter terms - 3 and 6 months - are getting the shorter end of the stick, at 4.85% p.a. and 4.99% p.a., respectively.
The minimum deposit is $1,000.
Credit Union SA ups 5-month term deposit
| Term | New rate (change) |
|---|---|
| 5 Months | 5.00% p.a. (+120 bps) |
| 6 Months | 4.00% p.a. (-90 bps) |
| 3 Years | 3.00% p.a. (-50 bps) |
| 4 Years | 3.00% p.a. (-50 bps) |
| 5 Years | 3.00% p.a. (-50 bps) |
The South Australian financial institution has also joined the 5% club, hiking the rates of a peculiar term by a hefty 120 points.
Credit Union SA is currently offering its top rate through its 5-month term deposit.
Depositors who opt for a 6-month fixed term will have to contend with a lower rate, more so if you lock in for three to five years.
These rates are available for a minimum deposit of $1,000.
More term deposit rate hikes
- BCU Bank upped 4- and 6-month rates by 55 basis points; 4.95% p.a. is available through 4-month standard term deposit and 6-month 55 Plus TD.
- Community First Bank hiked 3- and 6-month term deposits up to 15 basis points
And a few cuts
- Hume Bank dropped 9- and 12-month rates up to 15 basis points
Photo by Miles Burke on Pexels
