Judo Bank makes post-RBA cut deposit rate changes

author-avatar By on March 04, 2020
Judo Bank makes post-RBA cut deposit rate changes

Photo by Thao Le Hoang on Unsplash

Popular neobank Judo has lowered interest rates on its term deposit products in the wake of yesterday's RBA rate cut.

The Reserve Bank of Australia (RBA) cut the cash rate yesterday by 25 basis points to a new historic low of 0.50%, driving many lenders to slash their home loan rates accordingly.

While much of the media attention has been focused on whether banks will pass on the full 25 basis points to mortgage customers, deposit rates are also affected. 

The March cash rate cut was somewhat unexpected until a few days prior, which is why many different banks, including Judo, actually raised deposit rates throughout February. 

If you're considering locking your money away in a term deposit before the next RBA rate cut, check out the below selection of high interest rate term deposits for a one-year term: 

Provider
Advertised
interest rate
Interest
frequency
 
1.50% End of term More details
1.50% End of term, annually More details
1.46% Annually,
end of term
More details
1.45% Monthly, annually More details
1.40% End of term More details

*Rates correct as at 09 July 2020. Rates based on a $50,000 deposit.

But following yesterday's announcement, Judo has been quick to cut some of its deposit rates by up to 10 basis points today. 

Judo's three month and nine month deposit terms were cut by 10 basis points to 1.80% p.a. and 1.90% p.a. respectively. 

Meanwhile, its six month and one year terms had interest rates cut by five basis points to 1.90% p.a. and 1.95% p.a. each. 

Terms over one year were unaffected, meaning Judo still has some highly competitive interest rates of:

  • 2.05% p.a. for two years
  • 2.15% p.a. for three years
  • 2.25% p.a. for four years
  • 2.35% p.a. for five years 

These interest rates are still comfortably ahead of competitors' rates. 

Term deposit rate changes tend to be announced sporadically throughout the month, rather than immediately after the RBA's announcement as what happens with the majority of home loan lenders. 

Not too many banks have announced deposit rate cuts as of yet, but expect many more to follow. 

With most banks' deposit rates now barely sitting above inflation (with most now at or below it), there is a real chance this new rate cut has the potential to affect the pockets of those who rely on cash to get by. 


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William Jolly joined Savings.com.au as a Financial Journalist in 2018, after spending two years at financial research firm Canstar. In William's articles, you're likely to find complex financial topics and products broken down into everyday language. He is deeply passionate about improving the financial literacy of Australians and providing them with resources on how to save money in their everyday lives.

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