A three month term deposit with Bank of Sydney now returns 5% p.a, level with Judo as the highest on market.

For six month terms, the new rate of 5.10% p.a is also just 5 basis points away from Judo.

Both these products are online only - in branch customers can only earn 3.50% p.a for three months and 3.90% p.a for six months.

These latest rate increases come just days after four and nine month rates were boosted.

Savers will welcome Bank of Sydney's return to prominence in the TD market - it remains the only provider to have cracked 5.50% during the rate hike cycle.

A turnaround for TD rates?

After a near uniform downward slide for term deposit rates over the opening months of spring, the past couple of weeks have brought some notable rate increases, including the aforementioned rates at Judo Bank.

This has coincided with bond yields picking back up after dropping in late August.

Markets took softer than forecast Q2 CPI inflation numbers as an indicator that the RBA could cut the cash rate sooner than expected, which lead to the decline in medium term bond rates.

However the most recent and stubborn Q3 inflation figures have put to bed any calls for an early rate cut, which should aid in boosting term deposit rate confidence further.

RBA governor Michele Bullock however has been resolute that rate cuts in 2024 are unlikely, and bond yields are now starting to reflect this again.

This might make more strong term deposit rates, at least on shorter terms, more of a possibility.

However as Huw Bough, Chief Retail Banking Officer at Bank of Sydney, told the Savings Tip Jar podcast, TD rate changes aren't always purely driven by interest rate expectations.

"There's probably three things behind [TD rate changes]...customer behaviour and demand...organisational strategy and position, and the third would be market conditions and competition," he said.

Bank of Sydney term deposit rate changes

Term length Deposit size Payment frequency Interest Rate (Change)
Three months* $1,000-$1,000,000 End of term 5.00% p.a (+1.50)
Six months* $1,000-$1,000,000 End of term 5.10% p.a (+0.05)

*Both of these products are only available to online customers


Advertisement

On the hunt for a high rate term deposit? These are some of the strongest returns available on the Australian market at the moment


At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]5000$product[$field["value"]]$product[$field["value"]]More details

Term Deposits ($5,000 - $500,000) - 6 months

    At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]5000$product[$field["value"]]$product[$field["value"]]More details

    Stow it Term Deposit - 6 months

      At Maturity$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]1000$product[$field["value"]]$product[$field["value"]]More details

      Fixed 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 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"]]1000$product[$field["value"]]$product[$field["value"]]More details
            • Competitive interest rates on all term lengths
            • Deposits covered up to $250,000 under Government’s Financial Claims Scheme
            • Loyalty bonus at renewal
            Disclosure

            Personal Term Deposits - 6 months

            • Competitive interest rates on all term lengths
            • Deposits covered up to $250,000 under Government’s Financial Claims Scheme
            • Loyalty bonus at renewal
            Disclosure
            Important Information and Comparison Rate Warning

            All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here.

            Rates correct as of November 9, 2024.View disclaimer

            Important Information and Comparison Rate Warning

            Picture by Andre Taissin on Unsplash