Bank CD rates, savings account rates, and mortgage rates have all dropped across the board after market uncertainty has taken hold of investors following the surprising Brexit vote.  Brexit, the popular vote in the United Kingdom to leave the European Union, has absolutely startled the market.  Market uncertainty was prominently on display as interest rates dropped and stock markets tumbled.

While the poll looked as though it may be close in the days running up to the election, it appears market participants were not prepared for the fallout once the votes were tallied.  In fact, quite a few news reports have commented on how the voters were not fully prepared for the economic ramifications that may unfold as a result of a departure from the EU.

The damaging economic impact expected to arise from the Brexit decision lies mostly with the trade agreements and easy access to EU markets that comes with EU membership.  Without membership, new treaties and trade agreements have to be written with EU countries independently.

New arrangements will now have to be established between Britain and the EU nations during a less than ideal economic climate.  In the meantime, businesses that use Britain as a base to serve EU countries are sure to cut back their operations and find a more hospitable host country within the EU.  Not good for trade and not good for employment in Britain.

Most economists have overwhelming agreed that a vote for Britain to leave the EU would have a harsh impact on the U.K economy.  The economic impact Brexit will have on the rest of the world however, is unclear.  Even so, financial markets reacted as if the impact is going to be disastrous.  Stock markets were rocked and the bond markets saw a flood of new money.  This risk-off trade pushed both, stock prices and interest rates lower throughput world markets.

In the U.S. market, the benchmark, ten year Treasury bond dipped to 1.57% shortly after the Brexit outcome was announced.  Rate reductions were not limited to Treasury bonds and lower rates quickly spread throughout the market resulting in cheaper mortgage rates and reduced savings rates.

The average 30 year fixed rate mortgage came within a hair of 3.50%, closing out the week at 3.597%.  Bank CD rates and savings rates were also lower on the week.  The average rate on the top yielding certificates of deposit slipped to 1.235%.  The best one year CD rates and five year CD rates saw the biggest rate cuts with the average rate on the top ten highest one year CDs slipping to 1.251% and the rate on the top ten highest five year CDs settling down just above 2.00% at 2.007%.

The best bank savings account rates and money market account rates saw rather significant cuts for variable rate products.  The average rate on the highest yielding savings and money market account slid to 1.066%.

Bank rates market recap for June 27, 2016:

CD interest rates:
Composite CD interest rate index 1.235 percent
3 month CD rates 0.532 percent
6 month CD rates 0.931 percent
1 year CD rates 1.251 percent
2 year CD rates 1.452 percent
5 year CD rates 2.007 percent

Money market and savings account rates:
Bank money market rates and savings account rates 1.066 percent

Mortgage rates:
30 year mortgage rates 3.597 percent
15 year mortgage rates 2.904 percent
20 year mortgage rates 3.407 percent
30 year jumbo mortgage rates 3.455 percent
30 year FHA mortgage rates 3.565 percent

Credit card rates:
Credit card rates for new credit card offers 13.89 percent

US Treasury rates:
Six month Treasury rate 0.38 percent
One year Treasury rate 0.48 percent
Two year Treasury rate 0.64 percent
Five year Treasury rate 1.08 percent
Ten year Treasury rate 1.57 percent

All bank savings rates and lending rates are based on surveys conducted by SelectCDrates.com at the close of June 24, 2016 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.

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