The new eight-month return at Judo is now 4.86% p.a. for interest paid at end of term, or 4.76% p.a. for interest paid monthly, on its Lunar New Year special offer.
That's the highest term deposit return in the Savings.com.au database for terms below one year, and only 2 bps behind Heartland Bank's 4.88% p.a. top one year return.
It comes only a week after Judo gave its long term rates a hefty boost, and becoming the first provider to offer a 5% return with its new top five year rate.
Judo term deposits are available for deposits starting at $1,000, all the way up to $2 million (you'll need to contact Judo if you're looking to deposit more than that).
How much could you earn?
Here's what an eight month investment with Judo Bank could be worth for various sized deposits, subject to income tax:
| Monthly income (4.76% p.a.) | Total interest (4.76% p.a.) | Interest at end of term (4.86% p.a.) | |
|---|---|---|---|
| $1,000 | $4 | $31.7 | $32.4 |
| $10,000 | $39.7 | $317 | $324 |
| $100,000 | $396.7 | $3,173 | $3,240 |
| $1,000,000 | $3,966.7 | $31,733 | $32,400 |
| $2,000,000 | $7,933.3 | $63,467 | $64,800 |
May rate cut sure thing?
Term deposit returns across the board are heading up, with the RBA expected by many economists to hike the cash rate at least once more this year.
The next monetary policy meeting is in March, but given the full picture of Q1 inflation won't be released by the ABS until 29 April the prevailing view is that the Board is likely to wait until May to act.
If that outlook changes it would likely curb the TD rate surge, but for now rhetoric from the RBA continues to point to a hawkish lean.
"Our full employment and inflation objectives are entwined and the data is painting a complementary picture with a bit too much pressure on both sides," assistant governor Sarah Hunter said last week.
"The recent acceleration of demand growth beyond our estimate of trend ... means we expect the labour market will remain tight and inflation will remain above target for some time."
As usual, the incoming data on economic growth, unemployment, and most importantly inflation will likely inform the RBA's decision making, with releases for all scheduled by the ABS before the May decision.
However, Ms Hunter also suggested some of the conventional thinking about the relationship between unemployment and inflation may be "a bit out of date".
"When the labour market is tighter ... than full employment on an ongoing basis, underlying inflation will hold above ... target, but not necessarily accelerate away from it," she explained.
"We have an anchor ... the old inflation accelerating/decelerating knife edge doesn't fit with today's economy."
That might suggest a higher tolerance for low unemployment as far as monetary policy goes, but Commbank economist Lucinda Jerogin said Ms Hunter's speech does "little to change our thinking for policy".
"We continue to expect a 25 bp rate hike in May," she said.
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Want to earn a fixed interest rate on your cash? The table below features term deposits with some of the highest interest rates on the market for a six-month term.
| Bank | Term Deposit | Interest Rate | Interest Frequency | Term | Automatic Rollover | Maturity Alert | Early Withdrawal Available | Minimum Deposit | Maximum Deposit | Notice Period to Withdraw | Account Keeping Fee | Online Application | Joint Application | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.35% p.a. | At Maturity | 6 months | $5,000 | $19,999 | – | – | |||||||||||||
5.20% p.a. | At Maturity | 6 months | $10,000 | $5,000,000 | – | – | |||||||||||||
5.15% p.a. | At Maturity | 6 months | $1,000 | $1,000,000 | – | – |
