Some of the top-rated term deposits in January 2024

Australians concerned about how shifting interest rates could affect their savings in 2024 could consider locking in a term deposit interest rate. However, it’s essential to carefully compare term deposits before you commit to help ensure your choice matches your personal goals and financial needs.

The first Reserve Bank of Australia (RBA) board meeting of 2024 is scheduled for February, with the RBA switching an eight-meeting calendar from this year. Some economists are predicting that the RBA could choose to raise the cash rate at this upcoming meeting, in order to ensure inflation falls towards the RBA’s 2% to 3% target band in a timely manner. However, other economists are tipping that the RBA could cut the cash rate once or twice in the second half of 2024.

While interest rate cuts may be welcomed by many mortgage holders and other borrowers as they may lead to cheaper loan repayments, Australians who rely on their savings could see their wealth grow more slowly if savings account rates also fall.

However, it’s important to note that there’s no guarantee that the RBA will raise or lower the cash rate this year, and if they do, banks and other Authorised Deposit-taking Institutions (ADIs) may not choose to pass on all the changes. For example, after the last RBA cash rate rise in November 2023, relatively few banks announced that they’d also be raising interest rates on savings accounts and term deposits. 

Keep in mind that to benefit from rising term deposit interest rates, you may need to wait for your current term deposit to mature and switch to a higher-interest option before it rolls over for another term. But if the cash rate falls, your term deposit interest rate should stay locked in for the remainder of the term, allowing you to calculate your wealth growth in advance.

To help you compare term deposits, RateCity’s Real Time Ratings™ combine the interest and flexibility of each term deposit into a single simple star rating. Because these ratings are regularly updated, you can get a better idea of the overall value that each term deposit could currently offer. The top-rated term deposits in different categories can be found in RateCity’s Term Deposit Leaderboards, and some of the top-rated term deposits could also become eligible for the RateCity Gold Awards.

(Rankings are correct at the time of publishing. Please note lenders may trade places on the list as interest rates and fees change and RateCity’s tracker reflects these movements.)

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