A host of banks upped term deposit rates this week back to 4.40% p.a. and above with more incoming data pointing away from any cash rate cuts in the near term.

Inflation is now firmly outside of the target band and some commentators are even calling for a hike at next week's monetary policy meeting (although market expectations are that this is still highly unlikely).

On Thursday, the ABS revealed household spending rose 1.3% in October, the largest increase in almost two years, which suggests the economy continues to run hot.

It's likely the RBA will need to see compelling evidence of inflation coming down significantly (or a major economic downturn) for rate cuts to be back on the table.

For TD fans, all this makes it appear more likely returns will continue heading up in the coming months.

While a return to the peaks of mid 2023 when some TD rates were at 5.50% is unlikely, the evidence of the past couple of years suggests some banks may be willing to go further at these interest rates.

In March 2023, when the cash rate was last at the current 3.60%, the average one year term deposit rate (per RBA data) was 4.10% p.a. - right now it's at 3.70%.

Granted, at that point future rate hikes were all but guaranteed, but given that average one year rate is lower than in May when rates were expected to be cut down near or even below 3% those in the market for a TD may be feeling confident about waiting for a couple of months to see if higher rates are in store.

ANZ, Macquarie go to 4.25%

Earlier in the week two of Australia's biggest banks pumped up TD rates, both taking the top rate to 4.25% p.a.

At ANZ that rate is available for eight month terms after a 0.25% increase, while Macquarie offers it on six month, nine month, and one year terms.

Macquarie also put up its three month rate 0.05% to a new top rate of 4.15% p.a.

Read more: ANZ, Macquarie term deposit hikes

Heartland Bank hikes rates by up to 20 bps

Term lengthDeposit sizeInterest payment frequencyNew interest rate
Six months$25,000+End of term4.40% p.a.
Nine months$25,000+End of term4.42% p.a.
One year$25,000+End of term4.45% p.a.

Heartland Bank tends to be a big hitter in the TD market and is once more back at the summit with its new one year rate.

At 4.45% p.a., that's the joint highest rate of any product in our database alongside Judo Bank (also one year).

For six month rates, Heartland draws level with the market leaders, while per Savings.com.au's market research its 4.42% p.a. return is the highest nine month rate.

G&C Mutual, Unity go to 4.40%

Term lengthDeposit sizeInterest payment frequencyNew interest rate
Six months$1,000End of term4.40% p.a.

The merged G&C Mutual Bank and Unity Bank put up six month rates this week, both hiking returns by 35 bps to a new top rate of 4.40% p.a.

Both banks now offer the same return as Heartland Bank and Australian Military Bank for six month terms, the highest such rate in the Savings.com.au database.

Other movers

  • Great Southern Bank adjust rates by up to 105 bps, dropping six and five month rates but boosting seven month returns to become its new highest rate product with a top rate of 4.10% p.a.
  • Regional Australia Bank hiked one year terms and above by up to 30 bps
  • The Mac hiked six month and one year rates by up to 20 bps
  • Gateway Bank hiked nine month and one year rates to 4.20% p.a. and 4.30% p.a. respectively

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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.

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Filters
BankTerm DepositInterest Rate Interest Frequency Term Automatic Rollover Maturity Alert Early Withdrawal Available Minimum Deposit Maximum Deposit Notice Period to Withdraw Online Application Joint Application TagsFeaturesLinkComparePromoted ProductDisclosure
5.25% 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
–
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