Some banks deliver term deposit lump of coal in Christmas wind-down
The market leading term deposit rate announced by Judo Bank turned out to be fleeting, the neobank cutting back returns just a week on from the initial increase.
Rate hikes in February next year and beyond remain a possibility, although with GDP growth coming in weaker than forecast for the September quarter, the RBA might now be wary of over-contracting the economy and causing a recession.
However as Warren Hogan, Judo Bank's very own chief economic adviser pointed out on X, this is merely the engineered "soft landing" the RBA has been parroting for a while now.
According to the RBA rate tracker, market expectations of an increase to 4.60% in February dropped from 23% on Wednesday to 8% on Tuesday.
It's probably premature to assume this will be another downward turning point for term deposit rates, but enthusiasts will be hoping this isn't a sign of things to come in the final weeks of the year.
Judo cuts rates up to 10 bps
Term length
Deposit size
Payment frequency
Interest rate (Percentage point change)
9 months
$1,000-$999,999
End of term
5.15% p.a (-0.05)
1-3 years
$1,000-$999,999
End of term
5.25% p.a (-0.10)
3-4 years
$1,000-$999,999
End of term
5.25% p.a (-0.05)
The rate cut means Judo is now back below Bank of Sydney and ING for one year terms, which both offer a maximum rate of 5.30% p.a.
It was announced this morning, two days after the GDP numbers were released, which might suggest Judo analysts now no longer expect further rate increases.
Judo remains the market leader for two, four and five years, while G&C Mutual still holds the title for three years with a 5.30% p.a return.
Bank Australia ups rates by 40 bps
Term length
Deposit size
Payment frequency
Interest rate (Percentage point change)
2 years
$500-$1,000,000
End of term
4.90% p.a (+0.40)
3 years
$500-$1,000,000
End of term
4.40% p.a (+0.40)
It wasn't all bad news this week though, with the other rate movement an increase from Bank Australia.
These rates still are well below what's on offer at Judo, although Bank Australia has a competitive rate of 5.20% p.a on one year terms.
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Harry O'Sullivan
William Jolly
Brooke Cooper
