Building society CBS Canterbury raised its term deposit rates for terms of three to nine months by 50 basis points (bps) to 4.50%. The new rate is for deposits over NZ$5,000. This follows a move yesterday by Kiwibank, which raised its four month and one year term deposit rates by 10 bps to 4.60%. CBS Canterbury's new nine month rate of 4.5% is higher than any currently offered by a bank, while the 4.5% for the other terms is matched or beaten by various banks, such as SBS Bank's offer of 4.65% for a special three month rate. Banks and building socieities are having compete hard for term deposits at rates significantly higher than the Official Cash Rate of 2.5%. Reserve Bank instructions to the banks to fund their lending through local term deposits rather than 'hot money' on wholesale foreign markets has intensified the competition. All the current term deposit rates are listed on our two pages here: - for term deposits less than one year - for term deposits of one to five years
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