It's no secret that borrowers are hit hard whenever the RBA increases the cash rate - variable interest rates on home loans often go up by the same amount.

However, the RBA's aggressive increases to the cash rate is primarily aimed at stamping out high inflation i.e. higher grocery prices at the checkout.

Annual grocery inflation for the September 2022 quarter came to:

  • 13% for breakfast cereals;
  • 10.5% for bread; 9.3% for beef;
  • 12.1% for dairy and 16.2% for milk specifically;
  • 16.2% for fruit and vegetables; 10.4% for eggs;
  • and a massive 19.3% for oils and fats.


This is compared to an overall annual inflation rate of 7.3%, according to ABS figures.

RBA Governor Dr Philip Lowe has said high inflation is a "scourge".

However, there are signs the RBA's rate hikes could be doing the intended job already, with inflation starting to come off the boil.

"There has been a substantial cumulative increase in interest rates since May," Dr Lowe said.

"This has been necessary to ensure that the current period of high inflation is only temporary. High inflation damages our economy and makes life more difficult for people."

Deeming Rates

Deeming rates - the interest rates the government deems your assets to be earning - are safe despite all the cash rate rises in 2022.

This is because they are a government function, not one of the RBA.

In its October Federal Budget, the Albanese Government announced a freeze on deeming rates at their current levels until 30 June 2024.

From 1 July 2022, the deeming rates are:

Deeming rates 2022/23 Single Couple (combined)
where at least one of you get a pension		 Couple (combined)
where neither of you get a pension
0.25% Up to $53,600 Up to $89,000 Up to $44,500 of each of your own and your share of joint financial assets
2.25% Above $53,600 Above $89,000 Above $44,500

Source: Services Australia, via Industry Super.

After the RBA cut the cash rate to historic lows in 2020, deeming rates were often more than what pensioners could realistically achieve on their savings accounts and term deposits. However the government of the day slashed deeming rates in late March 2020.

Age Pension

The age pension is indexed to inflation every year, and received its largest increase in 12 years recently due to high inflation. 

From 1 December pensioners can also receive a one-off $4,000 work boost.

Savings and Term Deposits 

Savings account rates and term deposit rates for new customers are expected to increase in-line with RBA movements (up by 25 basis points).

Check back on this page as Savings.com.au endeavours to deliver all the latest rate information.

Look for a savings account product that is sticking loyal to its customers by increasing by the same proportion.

Compare all the savings account rates over 4.00% p.a. here.

No matter who you bank with in Australia, all deposits are protected by the $250,000 Financial Claims Scheme, so your money is safe.

Interest rates are generally higher on savings accounts with more conditions, such as deposit requirements, transaction requirements, and needing to grow the balance.

Be aware some of the most competitive rates are age-limited.

If you want to 'set and forget' with a term deposit, be aware that exiting a term deposit early could result in penalties and interest sacrifices.

However, term deposits often come with the added benefit of zero conditions that need to be met other than a minimum one-off deposit, and have much higher maximum deposit ceilings, sometimes up to $5 million.

RBA data has the average bonus savings account rate at 3.05% p.a. for November, and 2.85% p.a. for one-year term deposits - it's not all that hard to find rates higher than the average.