Term Deposit Rates Are Falling – Is Now the Time to Lock in?
In a week marked by sharp term deposit rate cuts, Commonwealth Bank (CBA) has led the charge, reducing rates by up to 95 basis points. As the cash rate cut predictions gain momentum, other banks have followed suit, signaling that the peak of high savings rates may be behind us.
For savers looking to lock in a competitive rate, the window may be closing. While some smaller lenders are still offering 5% p.a. rates, the trend suggests that longer-term deposits will see further reductions in the coming months.
CBA’s Latest Rate Changes
CBA’s new highest special offer rate is 4.60% p.a. for a 10-month term, available only to existing customers. However, their previous top offer of 4.75% p.a. for eight months has been slashed to 3.50% p.a., marking one of the largest single-week drops seen in 2025.
| Term | New Rate | Change (%) | Interest Paid |
|---|---|---|---|
| 3 months | 2.95% p.a. | -0.15 | End of term |
| 4 months | 3.10% p.a. | -0.05 | End of term |
| 8 months | 3.50% p.a. | -0.95 | End of term |
| 10 months | 4.20% p.a. | +0.55 | End of term |
| 12 months | 4.15% p.a. | -0.10 | Annually |
| 13-17 months | 4.15% p.a. | -0.10 | Annually |
Who’s Still Offering 5% P.A. or More?
Some smaller banks remain in the 5% club, but their offers are shrinking:
- Gateway Bank – 5.00% p.a. for a 6-month term (down by 5bps).
- Bank of Sydney – 6-month rate dropped from 5.10% p.a. to 4.90% p.a., but 3-month rate surged to 4.95% p.a.
- Rabobank, ING, and The Mutual Bank – all cut rates by up to 20 basis points across various terms.
| Bank | Best Rate | Term | Change |
|---|---|---|---|
| Gateway Bank | 5.00% p.a. | 6 months | -0.05% |
| Bank of Sydney | 4.95% p.a. | 3 months | +1.70% |
| ING | 4.85% p.a. | 3 months | -0.05% |
| The Mutual Bank | 2.65% p.a. | 5 months | -2.05% |
| Rabobank | 4.75% p.a. | 3 months | -0.10% |
What’s Next for Term Deposit Rates?
With the RBA meeting on 18 February, where a 25bps cash rate cut is widely expected, term deposit rates are likely to continue declining. Savers who want to secure higher returns should act soon, as the best offers may not last.
Lock in a Competitive Rate with Vantage Loans
Not sure where to put your savings? Vantage Loans can help you navigate term deposit options, high-yield savings accounts, and investment strategies to maximize your returns. Speak with our financial experts to secure the best deal before rates drop further.
Call 1800 595 500, email support@vantagefinancial.com.au, or visit vantagefinancial.com.au to explore your options today.
