Interest rates rise and fall with the general level of other credit based interest rate accounts.  US Treasury securities prices and interest rates are likely move much faster and further than bank CD rates.  Short term Eurodollar deposit rates will also tend move quickly to credit market changes.   CD rates tend to move in a fairly slow manner.  If the economy is in a slump and interest rates are in a prolonged low interest rate cycle, you don’t want to get stuck buying a bunch of long term CDs with low interest rates.  When the economy picks up steam and demand drives interest rates higher, bank CD investors have to watch for rising rates and adjust their investments accordingly.  Monitoring other interest rate bearing securities can help evaluate the general direction of interest rates and help to avoid buying bank CDs with either too long a maturity or too short depending the interest rate trend.

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