As the possibility of a Federal Reserve interest rate hike becomes increasingly apparent, CD buyers are starting to feel the effects. Three term CDs saw their highest nationwide rates fall today, and instead of two institutions offering a market-leading rate of 5.35% APY, we’re down to just one.
Adding insult to injury, CBC Federal Credit Union, which just three days ago launched leading term rates of 4.95% APY for 4 years and 5.00% APY for 5 years, has now abandoned the leaders of that market. The top rates on those two terms are now down to 4.73% APY and 4.68% APY, respectively, both offered from Lafayette Federal Credit Union.
Key Takeaways
- The industry-leading terms rate is still 5.35% APY, but that rate is now only available from one credit union instead of two.
- The top rate on 4-year and 5-year CDs has dropped below 5% today, meaning 35 months is the longest term currently offering a rate of at least 5.00% APY.
- The number of nationwide CDs paying 5.25% APY or more fell to just six, after starting the week at 12.
- Top returns for jumbo CDs showed no movement today.
| CD term | Yesterday’s Top National Rate | Today’s Top National Rates | Change of Day (percentage of points) |
|---|---|---|---|
| 3 months | 5.00% APY | 5.00% APY | Unchanging |
| 6 months | 5.25% APY | 5.25% APY | Unchanging |
| 1 year | 5.25% APY | 5.25% APY | Unchanging |
| 18 months | 5.25% APY | 5.25% APY | Unchanging |
| 2 years | 5.35% APY | 5.35% APY | Unchanging |
| 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 | Unchanging |
Credit Human offers 5.35% APY on certificates for 24 to 35 months. It’s the highest rate available nationwide you can get on any CD term, an honor it shares with Langley Federal Credit Union, which still pays annual percentage yield (APY) on 22-month certificates. But Credit Human dropped its rate today to 5.00% APY.
Some of the top CD rates still beat the 5% March inflation rate released this week. This is a relatively rare occurrence, at least in recent years. No one knows what April’s inflation number will be, but it may be a good time to lock in an inflation-killing CD rate.
| CD term | Top National Bank Rates Today | Top National Credit Union Rates Today | Today’s Top National Jumbo Rates |
|---|---|---|---|
| 3 months | 5.00% APY | 4.50% APY | 3.91% APY |
| 6 months | 5.25% APY | 5.01% APY | 5.25% APY |
| 1 year | 5.25% APY | 5.15% APY | 5.15% APY |
| 18 months | 5.20% APY | 5.25% APY | 5.25% APY |
| 2 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% APR |
| 5 years | 4.50% APY | 4.68% APY | 4.84% APY |
| 10 years | 4.10% APY | 4.30% APY | nothing |
Jumbo certificate rates are unchanged, with a high rate of 5.25% APY over two terms. It’s often wise not to limit your search to jumbo CDs when you have a large deposit because you can usually find better rates on standard certificates. But right now the best jumbo 4-year and 5-year options actually pay more than the best standard CDs on those terms.
Below you can see how top CD rates have trended over the past few weeks. The points on the graph indicate a Monday-to-Monday look at the highest CD rates available nationwide in each term.
Will CD Rates Go Up or Down?
CD rates have risen as a result of the Federal Reserve’s aggressive increase in the federal funds rate to combat inflation. Although the Fed has raised the fed funds rate twice this year, both times by 0.25%, that’s less than the combined 4.25% of hikes it implemented last year. As a result, rates on deposit accounts increased in 2022, and then slightly increased this year.
Economic data released this week on inflation, retail sales, and manufacturing show increasing evidence of an economic slowdown, suggesting that the Fed’s rate campaign is beginning to take a significant hold. This in turn is fueling market predictions that the Federal Reserve will soon end its rate hikes. In fact, the leading forecast right now is for “one and done,” meaning just one more hike when the Fed meets in a few weeks, followed by a rate hike and ultimately a rate cut.
The Fed’s rate-setting committee concludes its next meeting on May 3. While it looks likely that it will make another hike on that day, the current movement in top CD rates indicates that some institutions are not waiting to start dialing back their aggressive rates. That means now is probably a good time to lock in a rate you’ll be happy to have for months or years to come.
Note that the “top rates” quoted here are the highest nationally available rates determined by Investopedia in its daily rate research of hundreds of banks and credit unions. This is significantly different than the national average, which includes all banks that offer a CD with that term, including many large banks that pay little interest. So, national averages are always quite low, while the highest rate you can get by shopping around is often five, 10, or even 15 times higher.
Disclosure of Rate Collection Procedure
Each business day, Investopedia monitors the rate data of more than 200 banks and credit unions that offer CDs to customers nationwide and determines daily rankings of the certificates. with a maximum fee per principal term. To qualify for our listings, the institution 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 while some credit unions require you to donate to a specific charity or association to become a member if you don’t meet other eligibility criteria (eg, you don’t live in a certain area or work in a specific type of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.
