bank rates

CD Rates Reach Record Lows This Week

CD rates declined this week, with the average yields on 3-month, 6-month and 12-month certificates of deposit reaching new record lows.

That’s too bad because this is a logical time to be buying short-term CDs.

CD rates declined again this week, with the average yields on 3-month, 6-month and 12-month certificates of deposit reaching new record lows.Since many economists expect the Federal Reserve will end its campaign to push interest rates artificially low by next summer, you want investments that will mature about then to take advantage of better returns.

(The general rule of thumb is to go short when CD rates are low and you think they’re going to go up, and long when interest rates are high and you think they’re going to go down.)

Bankrate’s weekly survey of large banks and thrifts taken Oct. 7 found the average annual yield for a:

3-month CD fell to 0.41% from 0.43%. That’s the lowest average since the survey began tracking 3-month CD rates in March 1989.

6-month CD fell to 0.61% from 0.62% — the lowest average since the survey began tracking 6-month CD rates in January 1984.

1-year CD fell to 0.93% from 0.95% — the lowest average since the survey began tracking 12-month CD rates in October 1983.

2-year CD fell to 1.43% from 1.46% — the lowest average rate since August 2003.

5-year CD fell to 2.23% from 2.25%. That’s still slightly above the 2.15% reached in July, which was lowest average rate since the survey began tracking 60-month CDs in January 1984.

Smart savers won’t settle for average returns — especially not lousy average returns like this.

Use our extensive database of CD rates to compare the best deals from scores of banks.

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