BNZ has raised some term deposit rates today (Wednesday), not by huge amounts, but notable all the same.
This continues the recent trend of rising rates on the savings side, even as home loan rates dip down somewhat unexpectedly.
The new BNZ six month rate is now 3.00% which is the highest of any main bank for that term, and a +15 basis points rise from them. Most challenger banks had already risen to 3% or higher, but this is new ground for main banks.
All other rises from BNZ just match their main rivals.
Among main banks, there is a substantial 100+ bps jump from three or four months of about 1.90%, to the 3% now available at six months.
There is another +30 to +40 bps jump to more nine month rate offers. And there is a further +70 to +100 bps jump to the 4.00% offers prevalent for a one year term deposit.
Among the challenger banks, there are further premiums on top of those.
This is a steepish rate curve at the shorter end of the term deposit market ('shorter' being one year and less). Our data of all bank averages shows the premiums for a one year term deposit have never been greater since we started recording this data in 2002.
The six month premium over the 90 day offers are now back up to levels we last saw (quite briefly) in 2008.
These overall movements may seem a little odd, especially in the light of a number of banks actually reducing some home loan rates over the past week or so. The logic of rising TD rates and falling mortgage rates at the same time is hard to see and suggests one of these trends wont be sustainable.
Wholesale interest rates have been inching down over the past week or so, so it might be the term deposit rate rises that are exposed to an adjustment soon.
Of course, the other important factor that will come into play in the next week is the Reserve Bank's Official Cash Rate review on Wednesday, August 17. And as this is a Monetary Policy Review as well, it will come with much more commentary and forecasts about how this regulator is thinking about our economy. These have the potential to be very influential on where term deposit rates go from here. Continuing to lean hard against inflation, even at the risk of recession, is likely to steepen the short end of the rate curve further. A wavering might ease things back.
An easy way to work out how much extra you can earn is to use our full function deposit calculator. We have included it at the foot of this article. That will not only give you an after-tax result, you can tweak it for the added benefits of Term PIEs as well. It is better you have that extra interest than the bank (and especially if you are in the 39% tax bracket - PIEs are taxes at 28% flat).
The latest headline rate offers are in this table after the recent increases.
Update: Please note that this table has been updated with subsequent Kiwibank changes which were not in earlier versions.
| for a $25,000 deposit August 10, 2022 |
Rating | 3/4 mths |
5 / 6 / 7 mths |
8 - 11 mths |
1 yr | 18mth | 2 yrs | 3 yrs |
| Main banks | ||||||||
| ANZ | AA- | 1.90 | 2.85 | 3.30 | 4.00 | 4.05 | 4.10 | 4.20 |
 |
AA- | 1.90 | 2.85 | 3.30 | 4.00 | 4.05 | 4.10 | 4.35 |
 |
AA- | 1.90 | 3.00 | 3.30 | 4.00 | 4.05 | 4.10 | 4.35 |
 |
A | 1.90 | 3.10 | 3.30 | 4.00 | 4.10 | 4.20 | |
 |
AA- | 1.90 | 2.85 | 3.20 | 3.90 | 4.00 | 4.10 | 4.30 |
| Other banks | ||||||||
| China Constr. Bank | A | 2.70 | 3.55 | 3.85 | 4.15 | 4.20 | 4.40 | 4.60 |
| Co-operative Bank | BBB | 1.80 | 2.85 | 3.00 | 3.90 | 4.00 | 4.10 | 4.30 |
| Heartland Bank | BBB | 1.80 | 3.60 | 3.45 | 4.20 | 3.80 | 4.10 | 4.20 |
| HSBC | AA- | 1.85 | 2.85 | 3.00 | 3.80 | 4.05 | 4.10 | |
| ICBC | A | 2.50 | 3.50 | 3.85 | 4.05 | 4.05 | 4.30 | 4.40 |
 |
A | 2.30 | 3.50 | 3.55 | 4.15 | 4.05 | 4.35 | 4.55 |
 |
BBB | 1.90 | 3.00 | 3.30 | 4.10 | 4.00 | 4.15 | 4.40 |
 |
A- | 1.85 | 3.05 | 3.00 | 3.90 | 4.00 | 4.10 | 4.30 |
Term deposit rates
Select chart tabs
We welcome your comments below. If you are not already registered, please register to comment
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.