Savings institutions continue to lower interest rates despite RBA rate hold
The RBA cash rate has remained at 1.50% for seven months now, yet term deposit and savings account interest rates continue falling.
The Reserve Bank of Australia (RBA) has today announced it will again hold the cash rate at 1.50%, making this the seventh month without a rate movement.
The last time the RBA shifted the interest rate was back in September 2016 when it lowered it 25 basis points from 1.75%.
Despite this continued rate hold, many providers have dropped their interest rates for term deposits and savings accounts over the last 30 days, meaning customers earn less interest on their balance.
In February, National Australia Bank (NAB) reduced the total interest rate on its Reward Saver account by 15 basis points to 2.55%, and People’s Choice Credit Union lowered the total interest rate on both its Bonus Saver and Online Saver accounts by 20 and 25 basis points respectively.
In the first week of March, we’ve already seen MOVE Credit Union lower its Express Saver rate by 25 basis points and Bank VIC drop the total interest rate on its S8 Bonus Saver from 2.42% to 2.40%.
Customers considering term deposits haven’t had much luck either; Newcastle Permanent, Bendigo Bank, Service One Alliance Bank, and U Bank all dropped the interest rate on their one-year term deposits by 20 basis points in the past month.
Both Macquarie Bank and Delphi Bank have lowered their 180 day term deposit rates by 15 basis points and 40 basis points respectively. Both of these were lowered in the past month.
However, there was a small number of providers that increased their interest rates in the past 30 days.
Westpac and St.George each increased their 1 year term deposit interest rates by 5 basis points, while credit Union SA increased the rate on its two year term deposit by 15 basis points to 2.80%.
If your provider has recently lowered its interest rates, there is no time like the present to compare your options and shop around for a better deal.
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