The RBA cut the official cash rate to a historic low of 1.50% and this led to two changes to yields offered in our cash accounts table. Both ING’s Savings Accelerator Account and Macquarie’s Cash Management Account reduced rates by 25bps. The account offering the highest rate in the YieldReport survey is the RAMS Saver Account but after the RBA’s rate change, it is likely that it won’t be long before RAMS and most other institutions lower their rates.
The RBA decision dominated a week in which there was an awful lot of data and central bank decisions both here and offshore. As expected the RBA cut rates by 0.25% and while economists said the bank would do so on the basis of inflation being well below 2.00%-3.00% target range, some analysts are suggesting the ‘high’ currency was as much a driver. In central bank land though, one can’t be seen to be targeting the exchange rate directly lest you draw the ire of US bureaucrats [see Hypocrite of the Year award]. That the exchange rate finished higher over the week of the rate cut demonstrates that central bank rate cuts are seen as “pushing on a string” in terms of their effectiveness.
Monday’s release of the Melbourne Institute’s Inflation Gauge July reading was overshadowed by the pending rate decision and retail sales on Thursday was viewed as disappointing, although excluding food the number was quite robust. Friday’s quarterly Statement on Monetary Policy, coming so soon after the rate cut did not add much except to confirm the market’s view the RBA has an easing bias.
|Product||Int p.a.||Special Cond|
|AMP Saver Account||2.35%||31 days notice|
|AMP Notice Account||2.45%|
|ANZ Progress Saver||2.26%||Min balance $5,000|
|Arab Bank Online Savings||2.05%||Up to $500k.|
|Bankwest Smarter Esaver||2.45%||Zero w/draw pm up to $500k|
|BoQ Cash Man Account||1.80%||Limit 1 w/draw pm|
|BoQ Bonus Interest Savings||2.55%||$250k+|
|CBA NetBank Saver||1.50%||$200pm dep, $100k lim, 1wd pm|
|CBA Goal Saver Ac||2.20%|
|CUA eSaver Plus Account||2.85%|
|Heritage Online Saver||2.45%||$750,000+|
|ING Savings Accelerator||1.90%||$150k+|
|ME Online Savings||1.55%|
|NAB Reward Saver||2.95%||1 dep no w/draw mth|
|Rams Saver Account||3.15%||$200 pm no withdrawal|
|USaver||2.06%||$200 pm up to $200k|
|USaver Ultra||3.12%||Up to $200k +$2k pm dep|
|Westpac Reward Saver||2.10%||dep $50 and no withdrawals|