CD rates made a small push upward during the third week of June.  Interest rates in general have been heading north bound since the start of May but have not quite flowed through to savings products in general and bank CDs specifically.  Positive economic news regarding employment gains, augmented auto sales, gains in retail sales and changes in housing have all been factors putting downward pressure on bond prices.  The weakness in the bond market, marked by falling prices and rising rates, has permeated into the mortgage market but has barely touched savings and CD rates thus far.

As positive economic data has continues to unfold, the outlook for increased interest rates and a rate increase by the Fed has risen.  The ten year Treasury bond reflected this sentiment by jumping from a yield of 2.05% at the close of April to almost 2.40% in mid June.  During this, somewhat brief period, of rising Treasury rates, long term CD rates barely budged.  The average rate found on the top five year bank CDs during the same time period, climbed from 2.152% to 2.154% or an increase of just 2/1000ths of a percent..  

Shorter term CD rates did about as well as the long term certificates with very little growth in the average yields.  The best two year CD rates available nationally climbed to 1.357% by the close of business on June 19th, based on the most recent survey of bank CD rates conducted by  Two year Treasury rates do not stay in place as CD rates with the two year T note edging higher to 0.65% by week’s end.

The average rate on the best one year CD rates available nationally came in at 1.191% during the most recent survey, an improvement of about one basis point from the end of March.  Six month CD rates and three month CD rates were also little changed with the average rate on the six month term certificates moving up to 0.810% and the average rate on the three month maturities coming in at 0.431%.

There are signs of rate activity heating up among some of the big online banks.  First Internet Bank has recently increased their CD rates as did Capital One and Emigrant Bank’s online banking division, MySavings Direct.

Competition among online banks and online banking divisions is a good sign for savers and investors indicating these banks are willing to pay higher rates of return to feed their lending activities.  Of course, the bond market action over the past few weeks may stall though the likelihood seems low as the US economy continues to improve and the European countries are showing the early stages of growth.

Additional rate information on the best CD rates available for consumers based on the most recent bank rate survey for the week ending June 19, 2015 can be found at the following interest rate tables: three month CD ratessix month CD ratesnine month CD rates, one year CD rates, two year CD rates, three year CD rates, four year CD rates and five year CD rates.


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