Big bank term deposit rates falling fast
The big four banks have all lowered their term deposit rates this week. The rates are almost the same so I won't bother to differentiate. For 1-year money you now receive only 5.3 per cent although if you put your money on shorter terms – for, say, five to six months – you can gain 5.5 or 5.6 per cent. Clearly the banks expect rates to fall.
The 5-year rate is now down to 5.8 per cent – still way above the bond rate, even though deposits under $250,000 are government guaranteed .
There is now enormous market pressure for the Reserve Bank to lower rates, given the difference between the Australian official cash rate and government bond rates.
Source: Business Spectator