- Term deposit rates continue to climb across the market
- One smaller bank is offering a market-high rate of 5.60% p.a.
- There is no sign of term deposit rates losing steam with some economists now forecasting another two cash rate increases in 2026
Term deposit rate fixers have been on a race to the top in recent weeks, falling over each other to grab their share of depositor funds in an uncertain market.
Some economists are now confidently predicting there'll be at least another two cash rate increases in 2026, ignited by the inflationary pressures of the conflict in the Middle East.
Oil price shocks flow through to nearly all sectors of the economy and even though this week's February CPI data showed inflation was slowing, that's now been blown up by the ongoing war.
War, what is it good for?
War can do shaky things to markets, particularly in the early days, so those holding cash may be lured to stow it in a term deposit, promising a guaranteed return on a set date.
But in an escalating market, the trick is to know when to lock in - and for how long.
An eye-catching term deposit rate in March may not be as lucrative as one offered towards the end of the year, which becomes a moot point if your funds are already tied up.
To tempt wavering investors, one small bank has dashed well ahead of the market with a rate of 5.60% p.a.
Great Southern dangles the bait
Great Southern Bank, the old Credit Union Australia, is the big mover this week, offering 5.60% p.a. for a five-year investment of amounts over $5,000 with interest paid end of term.
It drops to 5.50% p.a. for those choosing monthly interest, but those rates are only available to customers aged 55 and over.
Regular customers can lock in for five years at 5.50% p.a. or at 5.40% p.a. with monthly interest payments.
Great Southern put the burners under a host of its term deposit rates on Thursday, some increasing by up to 2.40% p.a.
Its standard one-year rate is now 5.25% p.a.
Judo Bank leads the 12-month pack
Earlier in the week, plucky microbank Judo Bank lifted its one-year rate to 5.35% p.a. for deposits between $1,000 and $2 million, with interest payable end of term.
The rate is 0.10% p.a. clear of the one-year rates offered by several other competitors but given the pace of the market, Judo may not hold the number one spot for long.
Customers opting for monthly repayments on their one-year deposits can get 5.25% p.a.
Gateway Bank offers 5.30% p.a. for 12-months
Not to be sneezed at is the offering of another smaller player Gateway Bank which upped its 12-month rate to 5.30% p.a. for deposits between $1,000 and $500,001 with interest paid annually.
The customer-owned bank is also offering 5.10% p.a. on a nine-month deposit and 5.05% p.a. for six months, both with interest paid end of term.
But G&C Mutual looks to have claimed the market-high six-month rate with its 5.10% p.a., an increase of 0.30% on the old rate, for balances over $1,000.
It was part of a major term deposit rate overhaul that saw some rates lifted by up to 1.60%.
CommBank, ANZ post highest term deposit return of the big four
The biggest and the smallest of the big four lifted many term deposit rates on Friday morning, hiking those on select deposits to as high as 5.00% p.a.
That rate is available to CommBank customers locking away between $50,000 and $5 million, with interest paid annually.
The bank offers rates of 4.95% p.a. to those with smaller deposits of between $5,000 and $49,999 on the same terms or those wanting interest paid semi-annually.
CommBank also posted a limited time term deposit special offer: 4.90% p.a. on a 12-month deposit of between $5,000 and $5 million, with interest paid annually.
Meanwhile, ANZ hiked returns on its one-year term deposit by 0.20% to 5.00% p.a. for customers depositing between $5,000 and $2 million with interest paid annually.
Macquarie nudges higher again
Australia's fifth big bank Macquarie Bank has been playing the incremental game with its term deposit rates in the current upcycle.
On Tuesday, it edged its highest one-year rate up another 0.10% to 5.10% p.a. for deposit amounts between $5,000 and $1 million with end of term interest.
The Macquarie rate fixers are not of the leapfrog mindset but keep their rates comfortably ahead of those offered by the big four.
Now is a good time to check the highest rates on offer at the big five (for lower deposit amounts):
| Bank | Rate | Term | Deposit amount | Interest paid |
| CommBank | 5.00% p.a. | 2 years | $50,000-$5 million | Annually |
| Westpac | 4.90% p.a. (special offer online rate only) | 2 years | $5,000 - $2 million | At maturity |
| NAB | 4.80% p.a. | 12 months | $5,000 - $1,999,999 | At maturity |
| ANZ | 5.00% p.a. | 12 months | $5,000 - $1,999,999 | At maturity |
| Macquarie Bank | 5.10% p.a. | 1 year | $5,000 - $1 million | At maturity |
Westpac upped the rates on its term deposit specials this week, for 12-month or two-year deposits, offering an extra 0.10% p.a. to customers who open or renew online.
ING, Rabobank up term deposit rates
The two Dutch-owned online banks are not related but both increased their term deposit offerings this week.
ING is the sixth-largest holder of Australia's household deposits behind the big five.
It lifted rates twice, first by up to 0.25% and again by up to 0.20%, now offering 5.20% p.a. for one-year deposits and 5.05% p.a. for six-month deposits of amounts between $10,000 and $5 million with end of term interest.
Rabobank has been in the 5% club for some time with its five-year rates.
Its longer-term rates are still the most attractive with a top rate of 5.35% p.a. applying to deposits over $500,000 to $2 million with annual interest payments.
For deposit amounts between $1,000 and $100,000, there are no terms under five years that hit the 5% benchmark.
Other rate movers
The rates above are the more notable from a torrent of rate movements this week.
Here's another couple worth mentioning:
- Bank First is offering 5.25% p.a. on a one-year deposit over $500 with interest paid annually and 5.15% p.a. to those depositing over $5,000 in its Regular Income one-year product with fortnightly interest payments
- Australian Military Bank will pay 5.20% p.a. on a seven-to-eight month deposit on amounts between $1,000 and $250,000 with interest paid end of term while those under 17 can get the same rate with a $500 deposit
- Bendigo Bank lifted eight- and 12-month term deposit rates to up to 4.70% p.a. for one-year terms with interest paid end of term
- Bank of Queensland increased rates on term deposits, now offering up to 5.10% p.a. on terms of 12 to 23 months with interest paid annually.
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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 | – | – |
