There’s no relief in sight for beleaguered certificate of deposit investors, and no help from an economy that continues to pour cold water on CD rates.
We’ll get to the number in a moment, but by and large, CD rates were down again last week, as measured by the BankingMyWay Weekly CD Rate Tracker.
It wasn’t like there was some specific economic news that drove CD rates further south. In fact, the news we saw last week wasn’t so bad — there was a positive report from the U.S. Treasury that banks have paid back most of the money they borrowed from taxpayers as part of the TARP bailout.
Also, consumers likely gained some relief from a Federal Reserve announcement of a few last-minute additions to its credit card reform rules. Now the Fed says that credit card firms can’t charge more than $25 in late payment fees (per month). Also, card companies must explain to customers exactly why their card APRs were raised.
The CD market still might be suffering from last week’s reports that the Federal Reserve Bank won't lift rates until 2012.
That put a damper on bank deposit investors, who haven’t had much to cheer about lately. Some solace might have been taken from remarks last week from Federal Reserve Chairman Ben Bernanke, who told ABC News that he didn’t expect the U.S. economy to fall back into a “double-dip” recession. On the flip side, Bernanke also said he didn’t expect a big rebound, either. “My best guess is we’ll have a continued recovery, but it won’t feel terrific,” he said.
The Federal Reserve Bank of Chicago’s chairman, Charles Evans, also weighed in on the interest rate issue, echoing the sentiments of other Fed leaders by saying there’s “no hurry” in raising rates, and that there will continue to be “accommodative policies for quite some time.”
In other words, don’t look for a rate hike anytime soon, and don’t look for a big uptick in CD rates anytime soon, either.
For the week that was, CD rates fell again, sometimes by 10 basis points or more. Let’s take a look, as calculated by the BankingMyWay Weekly CD Rate Tracker:
Description This Week Last Week
60-Month CD 2.059% 2.074%
48-Month CD 1.751% 1.764%
24-Month CD 1.18% 1.188%
12-Month CD 0.738% 0.743%
Six-Month CD 0.48% 0.485%
Three-Month CD 0.307% 0.312%
In plain sight, the longer end of the CD yield curve took quite a beating last week, and CD rates at the lower end of the scale didn’t fare much better. For some relief in the form of good rate deals, look to BankingMyWay's CD Rate Search. Week-to-week, it’s the most thorough review of bank CD rates in the market.
—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.