Australia's fifth-largest bank led the handful of term deposit providers that moved rates a fortnight before the RBA delivers its latest policy decision.
Prior to the release of the pivotal Q2 CPI data on 31 July, market watchers anticipate a cash rate hold at a 78% chance.
While no major bank economists have explicitly forecasted another hike, they've forewarned of prolonged rate cut delays and near-term risks of rising rates "if the June quarter CPI data comes in too hot".
"[A trimmed mean] outcome of 1.1%/qtr or above would mean an August rate hike is more likely than not," CBA economist Stephen Wu said.
"A 1.0%/qtr outcome is in the 'grey zone' and the underlying details at the component level will be crucial."
NAB, on the other hand, believes such an outcome will not necessitate another round of cash rate increase but rather a change in strategy, where rates are kept lower for longer to maintain material gains, particularly in employment.
Whether the RBA will be forced to inch towards a 5% cash rate, as some pundits believe is the right level to bring inflation down, we'll find out soon enough.
In the meantime, term depositors may opt to hold out for potentially higher returns (should inflation come in hot), or lock away their funds on these newly adjusted rates.
Macquarie Bank cracks past the 5% mark
For the second consecutive week, Macquarie Bank has boosted its term deposit rates as it appears to vie for the market leader status in the 12-month space.
- 3 Months: 5 basis point hike to 4.95% p.a.
- 12 Months: 10 basis point hike to 5.10% p.a.
Just last week, the bank applied a 5 basis point boost to its 12-month term deposit.
The minimum deposit to get these rates is $5,000 and the maximum is $1 million, with interest payable at maturity.
While Macquarie is making moves, it is a fair way off the pace of the market leader, Heartland Bank, which boasts a 5.35% p.a. rate on 12-month terms.
Bank of Sydney ups special offer TD rates
Bank of Sydney has increased the rate on its online-exclusive deposit products on 3- and 6-month terms.
A 25 basis point hike has propelled the 3-month rate up 4.90% p.a.
By contrast, Bank of Sydney's regular 3-month term deposit commands a much lower 4.55% p.a. interest rate.
A 5 basis point bump has, meanwhile, brought its 6-month online-only TD rate to 5.15% p.a. That's 40 basis points higher than the standard product on the same term.
These boosted rates are available for term deposits opened via the bank's website.
The minimum deposit is $1,000, and interest earnings are paid at the end of term.
Horizon Bank hikes one-year term deposit rates
Customer-owned Horizon Bank has joined in on the rate-hiking action, boosting its 12-month term deposits by 20 basis points.
The bank's term deposit product paying interest at maturity now commands a 4.80% p.a. rate.
Meanwhile, depositors who prefer to receive their interest earnings on a monthly basis are offered 4.70% p.a.
The minimum deposit is $1,000.
This week's term deposit rate cuts
- Gateway Bank slashed 5 basis points on 3-, 6-, 9-, and 12-month term deposit products. Its current top rate is 5.15% p.a. (6-month)
- Arab Bank Australia cut 5 basis points on its 6-month term deposit, and 10 basis points on its 9-month TD.
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