Bank certificate of deposit rates were lower for the third consecutive week in 2010.  The average yield for the top ten best bank CD rates available nationally fell across all maturities.  For the week ending January 22, 2010 the short term bank CD rates incurred the most damage while the mid term and longer term CDs were down modestly.

Unfortunately, for savers that are holding on to short term maturities in the hope of getting an increased yield when interest rates rise, the short term rates are those that are taking the biggest dip and the CDs that were being purchased on the short end of the curve that now come up for renewal are at new rates that are measurably lower. 

The average rate on the best six month bank CDs moved down by three basis points or 3/100 of a percent bringing the yield to 1.38%.  The best six month CD rate now stands at 1.45% down from last week’s best rate of 1.51%.

The average yield for the best one year CDs available nationally dropped two basis points to come in at 1.81 percent.  The highest one year CD rate available fell one basis point to 1.90 percent.

Two year CD rates fell by a modest one basis point with the average two CD interest rate now standing at 2.20 percent from 2.21 percent ion the previous week.  The best two year CD rate held steady at 2.40%.

The average of the top ten best five year CD rates was also lower by one basis point.  The average yield on the five year certificates is 3.27 percent.  The highest five year CD rate available nationally is coming in 3.40%, unchanged from the preceding week.

One key factor driving interest rates lower is the sign that the economy is not clawing its way back from the sluggish production of last year.  Bond investors have shown little consideration to the rising stock market and the increased supply of Treasuries used to finance the growing federal deficit and have scooped up new Treasuries at a surprising pace driving yields down since the start of the year.  Lower Treasury yields are a key sign that bank rates are not likely to rise.

Investors willing to shop for their FDIC insured certificates of deposit in their local market will often do far better than those found nationwide.  Shop and compare the best national rates and national averages and then compare the best CD rates in your state to find the CD interest rates that match your goals.

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