Now That Rate-Cut Signals Are Here, What Should I Do With Savings and Deposits?

Got a source? Where did this so-called signal come from? If you're basing this on the dot plot, they did the exact same thing last year too.

Agreed. Ultimately, it really comes down to the nature of the funds. I'm splitting mine into 3-month maturities and rolling them.

Well, the idea that 'the direction for the second half becomes clear' is something we've been hearing for years. This time last year, everyone was saying a rate cut was imminent, but in reality nothing changed, and people who got into bond ETFs back then had a rough time, asking whether those paper losses were for real. Even if deposit rates now aren't what they used to be, a product that pays fixed interest and a directional bet are completely different things, so extending duration because of the word 'signal' seems a bit hasty. At the very least, wouldn't it be better to work out how much volatility you can handle and then move?

Last year, while dealing with a similar dilemma, I put half in a 6-month fixed deposit, half in a parking account, and used the rest to dollar-cost average into ETFs. In the end, the deposit side gave me peace of mind. Bond ETFs can be quietly stressful because if you get the rate direction wrong, you end up with paper losses, so if that doesn’t suit your temperament, I’d advise against them. If your maturities are clustered at the end of the year, spreading them out in 3-month increments starting now will make it easier to respond no matter which way things go. I’d recommend not making a rushed, all-at-once decision and instead rolling with it as you go.