After the election on November 6th, the consumer came out ahead for both savers and borrowers.  Not because of the election results, those idiots couldn’t manage Romper Room let alone a nation.  Democrats run debt through the roof, economy stays stagnant, government gets bigger, the Republicans say no to all taxes because they live in La-La land and also want a strong military because the Canadians may invade our nation or some such nonsense.  Elected officials are there to represent the will of the people and lead the people.  Democracy has taken over 200 years to show it may just fail after all.  Tirade is over, back to why the consumer came out ahead regarding bank rates.

As the week of the election came to a close, the stock market investors got whacked upside the head, which is going to bring about another mini tirade.  Obama was favored to win the election since day one.  Sure, the Republicans had hope and kept building excitement, but the numbers were never there in the key battleground states.  Why is that important you ask?  The market should have built in an Obama win which is generally perceived as bad for business, more taxes and especially more regulation which is not conducive to growth which in turn leads to stock market losses.  If the market is efficient, there should be no reason for the sizeable sell off that was experienced immediately after the election.  The Dow, S&P 500 and Nasdaq all lost over two percent last week with all of the losses taking place immediately after the election results.  Curious reaction if the market is truly efficient and processes all available information.

The standard consequence of market losses in equities is bond market gains and that is exactly what happened.  As the stock market slipped, bond prices moved higher and interest rates for Treasuries and mortgages moved lower.  The average 30 year mortgage rate in the bank rate survey was lower by almost 12 basis points dropping to 3.388 percent from 3.507 percent in the previous week.  All mortgage loan products in the survey followed suit with the 30 year jumbo mortgage rate dipping down by just under ten basis points to 3.790 percent and the 30 year FHA rates falling by nine basis points to an average rate of 3.383 percent.  That’s the first part of the good news for consumers.

The second part of the good news was the opposite reaction in bank savings products to that of the mortgage rates.  CD rates, money market rates and savings account rates were all higher on the week.  The increase in CD rates and savings account rates appears to be the result of aggressive pricing by the banks jostling for the top spot for the best rates in the nation. 

The average CD rate coming from the top ten best bank CD rates measured by the CD rate index rose by 6/1000ths of a percent to 1.051 percent.  The best one year CD rates were up by almost one basis point to 1.074 percent from 1.063 percent in the prior week.  The best six month CD rates and two year CD rates were also higher on the week with the six month rising by not quite one basis point to 0.775 percent and the two year increasing by over one basis point to an average yield of 1.202 percent.  The three month rates and long term, five year CD rates, failed to take part in the little rate rally, but the news wasn’t all bad.   The top three month CD rates and five year CD rates held their ground and were unchanged from the prior week.

The top savings account rates and money market account rates moved higher along with CD rates.  The average rate on the top ten highest bank money market account rates and savings accounts rates was boosted by 1.2 basis points to an average yield of 0.964 percent.

Credit card rates failed to pay attention to the market action and sat on the sidelines as other lending rates moved lower.  The average rate for new credit card offers stayed at 13.71 percent.   This is the third consecutive week of no change in the average credit card rate and the second week in which there was very little activity among the major credit card issuers regarding new promotions over new perks and benefits including credit card cash rewards and short term promotional interest rates.  Of course, there remains a wide spread between the various credit card offers from the best credit card rates to the longest term zero interest rate card promotions.  As always, buyer beware when selecting a new credit card, the field is filled with a number of winners and losers.

Treasury rates were lower on the week for all but the short term securities.  The six month Treasury rate was unchanged at 0.15 percent.  The one year and two year Treasury securities both gave up one basis point to end the week at 0.18 percent and 0.28 percent, respectively.  The five year Treasury rate was off by eight basis points bringing the rate down to 0.65 percent.  The ten year took a noteworthy cut of 14 basis points to yield 1.61 percent at the close of the week.

The weekly bank rate survey provides a detailed report on bank savings rates and lending rates by consumer rate category.  The most current survey is for the week ending November 9, 2012.  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 for November 9, 2012

CD interest rates:
Composite CD interest rate index 1.051percent (up .006 percent)
3 month CD rates 0.478 percent (unchanged)
6 month CD rates 0.775 percent (up .005 percent)
1 year CD rates 1.074 percent (up .011 percent)
2 year CD rates 1.202 percent (up .015 percent)
5 year CD rates 1.726 percent (unchanged)

Money market and savings account rates:
Bank money market rates and savings account rates 0.952 percent (up 0.12) 

Mortgage rates:
30 year mortgage rates 3.388 percent (down .119 percent) 
15 year mortgage rates 2.738 percent (down .065 percent) 
20 year mortgage rates 3.317 percent (down .081 percent) 
30 year jumbo mortgage rates 3.790 percent (down .097 percent) 
30 year FHA mortgage rates 3.383 percent (down .087 percent)

Credit card rates:
Credit card rates for new credit card offers 13.71 percent (unchanged)

Treasury rates:
Six month Treasury rate 0.15 percent (unchanged) 
One year Treasury rate 0.18 percent (down .01 percent)
Two year Treasury rate 0.27 percent (down .01 percent)
Five year Treasury rate 0.65 percent (down .08 percent)
Ten year Treasury rate 1.61 percent (down .14 percent)

All bank savings rates and lending rates are based on surveys conducted by at the close of November 9, 2012 with all of the interest rates obtained directly from the banks within the survey.  Treasury rates are obtained directly from the Department of the Treasury.  

Additional bank rate data for mortgage rates, CD rates and checking accounts for the week ending November 9, 2012 can be found at the following rate tables:  9 month CD rates, 3 year CD rates, 4 year CD rates, 20 year mortgage rates and the best interest checking accounts.

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