CD investors and savers had to endure some more pain over the past week as CD interest rates moved lower one more time this year.  The average bank CD rate as measured by the CD rate index was lower by just over one basis point.  The average CD rate, per the CD rate index, dipped down to 1.128 percent from 1.139 percent in the previous week.  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 drop in CD rates was not terribly surprising coming on the heels of near record lows in mortgage rates and Treasury rates.  During the week, the ten year Treasury rate slipped below 2.00 percent for the first time in November.  While the ten year Treasury bond moved lower, the six month and one year Treasuries were held in check at astonishingly low levels.  The six month Treasury rate ended the week at a mere 0.04 percent while the one year closed the week at 0.12 percent.  Since these investment options are considered the safest investment choices, it is not surprising that these low rates of return are putting pressure on the near equally safe yields of bank CDs.

Short term CD rates moved very little this week.  The average rate for the best three month CD rates held steady at 0.527 percent.  The top three month CD rates have displayed no change in rate over the past two months.  The highest three month CD rate is available at Hudson City Savings Bank with an interest rate of 0.75 percent.  The second best rate is available at two banks at a significantly reduced rate.  Both, Virtual Bank and One West Bank have the next best rates by offering three month CDs that yields 0.60 percent with a three month CD also at 0.60 percent.  

Six month CD rates also showed no change in rate this week.  The average rate for the top ten best six month CDs remained at 0.806 percent.  The top banks in this category were unchanged from the prior week with AloStar Bank promoting the highest six month CD rate at 0.86 percent.  The next best six month CD rate comes from fours bank just one basis point off the highest rate.  Stonebridge Bank, Virtual Bank, Ascencia Bank and One West Bank market six month CDs with interest rates at 0.85 percent, the second highest arte available nationally.

The best one year CD rates showed little change among the highest rates but the average rate for the top ten best one year CD rates did move lower on the week.  The average rate for the top ten best one year CD rates declined by one basis point to 1.087 percent, from 1.097 percent in the week earlier.  The best one year rate is available at two banks; Doral Bank Direct and CIT Bank share the lead with CDs that yield 1.15 percent.  AloStar Bank has a one year CD three basis points beneath the top rate at 1.12 percent.

The top two year CD rates experienced only a minor reduction in the average rate.  The average rate for the highest two year CD rates ended this week at 1.268 percent which is just fractionally lower than last week’s rate of 1.273 percent.  The slight change had no impact on the highest rate and the banks that are offering that rate.  The best two year rate remains at 1.30 percent and is currently being marketed by four banks; Ultima Bank of Minnesota, American Express Bank, CIT Bank and AloStar Bank of Commerce.

The five year CD rates ate most of the losses in yield this week.  The average rate for the top ten highest five year bank CDs was cut back by over four basis points.  The average rate skidded down to 1.951 percent from 1.992 percent in the prior weekly rate survey.  State Bank of India holds the top spot with a five year CD yielding 2.02 percent.  Hudson City Savings Bank comes in second with a five year CD yielding 2.00 percent.  The third highest five year CD rate is just one basis point lower at 1.99 percent and is promoted by Intervest National Bank.

To find more information on the best CD rates by maturity please see the following CD rate tables at three month CD ratessix month CD ratesone year CD rates, two year CD rates and five year CD rates.

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