When central bank rates move, borrowing costs adjust quickly while savings rates take far longer to follow. The asymmetry is consistent enough to require an explanation beyond opportunism.
Deposits are not priced off the policy rate
A bank's deposit rate is a price it sets to attract and retain funding, not a rate passed through from anywhere.
The relevant question for the bank is how much it must pay to hold the deposits it needs, which depends on what competitors offer and on how likely customers are to move.
Where a bank already holds ample deposits, raising the rate simply increases the cost of funding it already has, which is a strong reason not to.
Banks also have alternative funding available in wholesale markets, so a deposit rate only needs to be competitive against those alternatives rather than against the policy rate.
Inertia is the bank's most valuable asset
Most balances do not move when a better rate appears elsewhere. Switching requires effort, and the gain on a modest balance can feel small relative to that effort.
Banks observe this directly and price accordingly, offering higher rates on products that attract active shoppers while leaving legacy accounts behind.
The result is a wide dispersion within the same institution, where two customers with identical balances receive very different rates depending on which product they hold.
Loan pricing is contractually linked
Many lending products are tied to a reference rate by contract, so an increase flows through automatically without any decision by the bank.
Deposit products carry no such link, and the terms typically reserve the right to vary the rate at the bank's discretion with notice.
That structural difference alone produces much of the observed asymmetry, before any question of intent arises.
The margin is the bank's income
A bank earns primarily from the gap between what it receives on assets and what it pays on liabilities, so widening that gap increases income directly.
Rising rates widen it automatically if lending reprices faster than funding, which is why bank earnings often improve early in a tightening cycle.
Competition eventually closes part of the gap as depositors move, but the adjustment happens over quarters rather than weeks.
Introductory rates transfer value between customers
Headline rates on new accounts frequently include a bonus that expires after a defined period, after which the balance reverts to a much lower rate.
Customers who track expiry dates and move capture the headline; those who do not fund it by holding balances at the reverted rate.
Because the bonus is disclosed and the reversion is in the terms, the outcome depends entirely on whether the customer acts, which is precisely what the pricing anticipates.