Bank interest rates and bond rates drifted measurably lower this past week with the exception of bank CD rates.  Lower rates have materialized throughout most interest rate sensitive products even as the Fed has stayed the course on their reduction in monetary easing by cutting $10 billion in bond buying per meeting.  Economic news has definitely been mixed with stronger than expected payroll and unemployment claims figures yet soft retail sales and housing figures giving little motivation for interest rates to react in either direction.

We are half way into May and mortgage rates continue to fight the forecasts presented by economic prognosticators with rates dropping yet again.  Mortgage rates are now well past their low points of 2014 and are sitting at the best levels since October 2013.  And while most of the interest rate market was retreating, certificate of deposit rates squeezed out yet another marginal increase in the average yield

As the cruel U.S. winter has finally passed by, the focus for the markets was returning to the economic data coming out to determine where interest rates and economic activity would go from here.  The recent move in interest rates to the downside does not appear to validate that thought, data is not terribly weak which would usually drive rates lower and many economists believe that the economy will have increased growth through the year albeit, at a fairly tepid pace.

The bank rate results this week produced some interesting results with CD rates and mortgage rates moving in opposite directions.  Higher CD rates are generally the result of competition among banks for depositor funds yet bank loan growth has been growing only marginally in the past year making the push for higher rates a bit curious.  Mortgage rates move rapidly in conjunction with activity in the bond market and bonds this week were being purchased at higher prices pushing the interest rates on the bonds lower including the rates on Treasury bonds and mortgage bonds. 

The average rate on the top yielding CDs available nationally increased by one basis point or 1/100th of a percent over the past week based on the current survey of bank rates conducted by SelectCDrates.com.  There was a barbell type shift in CD interest rates to the upside with short term, three month CD rates moving higher along with long term, five year CD rates.  The average CD rate measured in the SelectCDrates.com bank rate survey is based on a basket of the highest yielding bank CDs available nationally across a wide spectrum of CD terms or maturities.  The CD rate index bumped up to 1.103% this week from 1.093 in the previous week.

Mortgage rates went in the opposite direction in relation to bank CD rates.  The average 30 year mortgage rate coming from the top bank mortgage lenders in the nation was cut by 13 basis points over the week.  The average 30 year mortgage rate ended the week at 4.211% after starting out at 4.341%.  30 year FHA mortgage rates fell by slightly less than the 30 year conforming loan rates but the rate dip put the average FHA loan rate below 4.00% for the first time this year.  The average 30 year FHA rate closed the week at 3.950%.

The SelectCDrates.com weekly bank rate survey provides a detailed report on bank savings rates and lending rates by different consumer rate categories.  The current bank rate survey is for the week ending May 16, 2014 with rates obtained on or after that day.  The weekly rate survey presented the following interest rates and their changes for mortgage rates, CD interest rates, credit card rates, money market rates, savings account rates and Treasury rates.

Bank Rates Market Recap with the Weekly Change in Rates Offered for May 16, 2014

CD interest rates:
Composite CD interest rate index 1.103 percent (up .01 percent) 
3 month CD rates 0.396 percent (up .012 percent)  
6 month CD rates 0.732 percent (unchanged) 
1 year CD rates 1.033 percent (down .002 percent)  
2 year CD rates 1.187 percent (unchanged) 
5 year CD rates2.165 percent (up .002 percent) 

Money market and savings account rates:
Bank money market rates and savings account rates 0.879 percent (down .008 percent)

Mortgage rates:  
30 year mortgage rates 4.211 percent (down .13 percent)  
15 year mortgage rates 3.394 percent (down .095 percent)  
20 year mortgage rates 3.945 percent (down .121 percent)
30 year jumbo mortgage rates 4.099 percent (down .126 percent) 
30 year FHA mortgage rates 3.950 percent (down .075 percent)

Credit card rates:
Credit card rates for new credit card offers 13.86 percent (unchanged)

US Treasury rates:
Six month Treasury rate 0.05 percent (unchanged)
One year Treasury rate 0.09 percent (down .02 percent)
Two year Treasury rate 0.38 percent (down .04 percent)
Five year Treasury rate 1.56 percent (down .11 percent) 
Ten year Treasury rate 2.52 percent (down .08 percent)

All bank savings rates and lending rates are based on surveys conducted by SelectCDrates.com at the close of May 16, 2014 with all of the interest rates obtained directly from the banks within the SelectCDrates.com survey.  Treasury rates are obtained directly from the Department of the Treasury.  

Additional bank rate data is available to help consumer shop and compare mortgage rates, CD rates and checking accounts for the week ending May 16, 2014 at the following rate tables: 9 month CD rates, 3 year CD rates, 4 year CD rates, 20 year mortgage rates, VA mortgage rates, and the best interest checking accounts .

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