Bank CD rates continued to show some downward pressure from slow economic growth abroad and geopolitical tensions in select hot points in Eastern Europe and the Middle East.  The downward pressure offsets underlying forces that should start to push CD rates higher.  Upward pressures sitting under the interest rate market includes the Fed’s reduction in bond buying or monetary easing, heightened concerns over increasing inflation rates, and increased lending activity by domestic banks.

By Mid-August, the best CD rates available nationally increased just slightly with almost all of the rate increases taking place on longer term maturities.  Five year CD rates have continued to advance higher regardless of what the market has put in their way.  The rise in rates on the long end of the curve is frequently seen as an indicator that interest rates will rise overall in the near future.

Based on the most recent survey of bank CD rates conducted by, the average rate on the top CD rates offered nationally climbed to 1.120 percent.  The CD rate index measures the top ten highest CD rates available nationally for three month CDs, six month CDs, one year CDs, two year CDs, and five year CDs.  The current CD rate survey was performed on August 22, 2014.

The average five year CD yield in the current rate survey was boosted up to 2.176 percent.  CD rates also ticked up on two year certificates of deposit.  The average annual percentage yield, or APY on two year term bank CDs was raised to 1.234 percent by the top banks in the survey.

Short and midterm CD rates changed very little through most of August with slight increases in the midterm maturities and slight reductions on the very short term accounts.  The average one year CD yield came in at 1.057 percent.  Six month certificate rates were at 0.737 percent and the very short term, three month CDs offered an average interest rate of 0.396 percent.

The current CD rates have not reached the point where they are driving savers and investors to these bank products however, the highest yielding bank CDs available are head and shoulders above the average rates offered by local banks and credit unions and are measurable higher than comparable terms offered on safe and secure, Treasury securities.

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