Term deposits v funds: back to the interest rate race

NZ fund managers have traditionally seen the term deposit market as their main rival, enviously eyeing up the easy flows into banks. Soon, it will be the other way around. (Image: Getty)

David Chaplin

Tue, 09 Dec 2025

The household term deposit market has barely budged since the Reserve Bank of New Zealand began ratcheting down the Official Cash Rate from a cycle high of 5.25% last July to the current near basement-level of 2.25%.Reserve Bank of NZ (RBNZ) data shows the household term deposit (TD) stack has only dropped about $1 billion from the July 2025 peak of $144.6b to the Oct 31 reading of $143.5b.Investors, it seems, don’t care too much that TD rates now span a range of roughly 3.5% to 4% across the maturity spectrum compared to the 6% plus avai...

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