With the Fed rate plateau becoming more likely, CD shoppers are starting to feel the effects. Three terms on CDs saw their highest rates nationwide drop today, and instead of having two institutions offering the market-leading rate of 5.35% APY, the rate has fallen to just one institution.
To make matters worse, the CBC Federal Credit Union, which just three days ago launched leading rates of 4.95% APY for 4 years and 5.00% APY for 5 years, has already given up on these market leaders. The highest rates in those two quarters are now reduced to 4.73% APY and 4.68% APY respectively, both offered by the Lafayette Federal Credit Union.
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- The industry leading rate across terms is still 5.35% APY, but that rate is now only available from one credit union instead of two.
- The top rate for 4- and 5-year term certificates of deposit is down less than 5% today, which means that 35 months is the longest currently offering a rate of at least 5.00% APY.
- The number of CDs nationwide paying 5.25% APY or more fell to just six, after starting the week at 12.
- The top returns of the mega CDs did not show any movement today.
| CD term | Yesterday’s national high | Today’s highest national price | Today change (percentage points) |
|---|---|---|---|
| 3 months | 5.00%APY | 5.00%APY | No change |
| 6 months | 5.25%APY | 5.25%APY | No change |
| One year | 5.25%APY | 5.25%APY | No change |
| 18 months | 5.25%APY | 5.25%APY | No change |
| Two years | 5.35%APY | 5.35%APY | No change |
| 3 years | 5.35%APY | 5.00%APY | – 0.35 |
| 4 years | 4.95%APY | 4.73%APY | – 0.22 |
| 5 years | 5.00%APY | 4.68%APY | – 0.32 |
| 10 years | 4.30%APY | 4.30%APY | No change |
Credit Human has been offering 5.35% APY on certificates ranging from 24 to 35 months. It was the highest nationally available rate you could earn in any CD term, an honor it shares with Langley Federal Credit Union, which still pays an annual rate of return (APY) on 22-month certificates. But Credit Human is down today to 5.00% APY.
Many of the higher inflation rates on certificates of deposit still beat the March inflation rate of 5% released this week. This is a relatively rare occurrence, at least in recent years. No one knows what the inflation number for April will be, but this may be a good time to lock in the inflation counter-inflation rate.
| CD term | The highest rate of the National Bank today | Highest rate in the National Credit Union today | Today’s National Jumbo Highest Price |
|---|---|---|---|
| 3 months | 5.00%APY | 4.50%APY | 3.91%APY |
| 6 months | 5.25%APY | 5.01%APY | 5.25%APY |
| One year | 5.25%APY | 5.15%APY | 5.15%APY |
| 18 months | 5.20%APY | 5.25%APY | 5.25%APY |
| Two years | 5.28%APY | 5.35%APY | 5.04%APY |
| 3 years | 4.60%APY | 5.00%APY | 4.99% APY |
| 4 years | 4.55%APY | 4.73%APY | 4.89%APY |
| 5 years | 4.50%APY | 4.68%APY | 4.84%APY |
| 10 years | 4.10%APY | 4.30%APY | no one |
Jumbo certification rates are steady, with a 5.25% APY high in two quarters. It is often smart not to limit your search to bulky CDs when you have a large deposit because you can usually find better rates among the standard certificates. But right now, the best 4-year and 5-year jumbo options actually pay more than the best standard CDs in these terms.
Below you can see how top CD rates have trended over the past several weeks. The points on the graph indicate a Monday-to-Monday look at the highest CD-R available locally for each semester.
Are CD prices going up or down?
Cash deposit rates have increased dramatically as a result of the Federal Reserve raising the federal funds rate to combat inflation. Although the Fed has raised the federal funds rate twice this year, both times by 0.25%, this is far less than the cumulative 4.25% in the increases it applied last year. As a result, interest rates on deposit accounts increased in 2022, and then increased slightly this year.
This week’s economic data on inflation, retail sales and manufacturing show mounting evidence of a slowing economy, suggesting that the Fed’s interest rate campaign is starting to get more control. This, in turn, fuels market expectations that the Federal Reserve will end its interest rate hike soon. In fact, the main forecast right now is for “one and done,” which means just one increase when the Fed meets in a few weeks, followed by a stabilization in interest rates and eventually a decrease.
The Fed’s rate-setting committee will conclude its next meeting on May 3. And while it’s likely to make another hike that day, the current move higher in CD rates suggests some institutions aren’t waiting to start undoing their aggressive pricing. This means that now is probably a good time to maintain a rate you’ll be happy to have for months or years to come.
Note that the “higher rates” listed here are the highest rates available nationwide that Investopedia has determined in its daily rate search on hundreds of banks and credit unions. This is very different from the national average, which includes all banks that offer a CD with that term, including many of the larger ones that pay minuscule interest. Thus, the national rates are always very low, while the higher rates that you can find out by shopping around are often five, 10 or even 15 times higher.
Disclosure of the price collection methodology
Every business day, Investopedia tracks pricing data for more than 200 banks and credit unions that offer CDs to customers across the country and determines daily ratings for the highest-paying certificates in each key term. To qualify for our listings, an organization must be federally insured (FDIC for banks, NCUA for credit unions), and the minimum initial CD deposit must not exceed $25,000.
Banks must be available in at least 40 states. And although some credit unions require you to make a donation to a specific charity or association to become a member if you don’t meet other eligibility criteria (for example, you don’t live in a certain area or work in a certain type of job), we exclude credit unions whose donation requirements are $40 or more. For more information on how to choose the best rates, read our full methodology.