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- PERSONAL FINANCE NEWS
- CD NEWS
KEY TAKEAWAYS
- The highest nationally available CD rates held their ground across all terms today.
- The best overall CD rate in the country remains 5.65%, unveiled this week by MutualOne Bank on a 3-month term.
- The runner-up is Newtek Bank's 6-month offer paying 5.55% APY.
- CDs ranging up to 3 years are paying 5.00% or better, letting you extend your rate lock as long as 2027.
- The best CD rates have been gradually easing lower for months. But if the Fed appears ready to make a rate cut—something that could happen this year—they'll begin falling faster.
Below you'll find featured rates available from our partners, followed by details from our ranking of the best CDs available nationwide.
Lock In 5.40% to 5.65% APY for 3 to 12 Months
The highest CD returns continue to be available on short-term certificates. After two weeks of the nation-leading rate being 5.55% APY on a 6-month certificate, still available from Newtek Bank, a new CD took the rate crown this week. MutualOne Bank now offers 5.65% APY on a 3-month term.
In addition to those top two rates, 13 more CDs are paying 5.40% APY or more, with terms of 3 to 12 months. Four of those are 5-7 month CDs paying 5.50% APY.
For those wanting to stretch their rate lock a little further down the road than a year, the best 18-month CDs include six offers between 5.15% and 5.25% APY. Those would let you guarantee your return until late 2025.
Longer Terms Will Secure Your Rate to 2026—Or Beyond
Want to guarantee one of today's high CD rates even longer? You can choose a top 2-year CD paying 5.20%, locking it up until 2026. Or secure a 5.00% rate as far as 2027. Though that's the longest term offering a rate of 5% or better, you can alternatively opt to guarantee a high-4% rate for as far as 4 or 5 years into the future.
CD Rates Are Still Near Historic Highs
Certificate of deposit (CD) rates have inched lower since they climbed to a record high of 6.50% in October. At the start of February, the number of CDs in our daily ranking that paid a least 5.50% APY was 30. Today that count sits at six.
But don't lose sight of how high CD returns still are relative to the past 20 years. Locking in a yield in the 4% to 5% range for a year or more down the road is still a great earning opportunity.
Also keep in mind that snagging the absolute highest APY isn't the only way to win with today's CDs. Since CD rates could fall quite substantially in 2024 and 2025, locking in a long-term rate now— before rates move lower—can be a smart move.
Jumbo Deposits Can Provide More CD Options
The top two jumbo CDs let you earn more than you can with a standard CD. State Bank of Texas is paying 5.50% APY on a 12-month certificate, while My eBanc offers 5.49% APY for 6 months.
Beware that the best jumbo CD rates don't always pay more than standard certificates. Often, you can do just as well—or better—with a standard CD. That's the case right now in six of the terms below, so it's always wise to shop both certificate types before making a final decision.
Where Are CD Rates Headed in 2024?
To combat decades-high inflation, the Federal Reserve aggressively hiked the federal funds rate between March 2022 and July 2023, raising the benchmark rate to its highest level in 22 years. That's important to savers because when the fed funds rate rises, banks and credit unions increase the interest rates they're willing to pay on customer deposits.
As a result, this past fall saw historically favorable conditions for CD shoppers, as well as for anyone holding cash in a high-yield savings or money market account. Rates on CDs rose to an October-November peak that was the highest we've seen in two decades.
But since its last rate hike in July, the Fed has been in a holding pattern. On March 20, the central bank announced it would maintain the fed fund rate at its current level, the fifth meeting in a row it's done so.
That's because inflation has been cooling, allowing the Fed to stop raising interest rates. But further inflation progress has been elusive, putting the central bank in wait-and-see mode as it looks for evidence that inflation is falling enough to justify lowering the federal funds rate. Reiterating the Fed's recent meeting statement, Fed Chair Jerome Powell spoke this week about how the first rate cut could still be a ways off.
"We do not expect that it will be appropriate to lower our policy rate until we have greater confidence that inflation is moving sustainably down toward 2 percent. Given the strength of the economy and progress on inflation so far, we have time to let the incoming data guide our decisions on policy," Powell said in prepared remarks.
Federal Reserve Gov. Chris Waller expressed a similar sentiment last week, saying inflation and job gains data from this quarter have reinforced his earlier view that "there is no rush" to cut interest rates.
Economic indicators released after Waller's comments add ammunition to the argument that the economy is running strong and a rate cut isn't needed right away. Indeed, this morning's jobs number came in 50% higher than most economists had projected, fueling speculation that the Fed may need to keep rates higher for longer than originally expected.
At its March 20 meeting, the median prediction from members of the Fed's rate-setting committee was for three rate reductions this year. But confidence in that prediction is softening among fed funds futures traders. According to the CME Group's FedWatch Tool, only about half of traders are betting on a first rate cut by June, down from a strong majority earlier in the week. Similarly, only half are forecasting three or more cuts by the end of 2024, also down from a handy majority just a few days ago.
It still seems likely the Fed will find it appropriate to lower its benchmark rate sometime this year. But Fed moves several months into the future are unpredictable, and until more data come in, it's impossible to say if 2024 rate cuts will come to fruition.
As a result, CD rates could continue their recent plateau. If at some point it becomes clear the Fed is ready to make a first rate cut, that would drive CD rates down more quickly. But it appears a Fed move could potentially be months away.
The central bank will hold six more rate-setting meetings in 2024, with the next one scheduled for April 30 through May 1.
Note that the "top rates" quoted here are the highest nationally available rates Googlawi has identified in its daily rate research on hundreds of banks and credit unions. This is much different than the national average, which includes all banks offering a CD with that term, including many large banks that pay a pittance in interest. Thus, the national averages are always quite low, while the top rates you can unearth by shopping around are often 5, 10, or even 15 times higher.
How We Find the Best CD Rates
Every business day, Googlawi tracks the rate data of more than 200 banks and credit unions that offer CDs to customers nationwide and determines daily rankings of the top-paying certificates in every major term. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the CD's minimum initial 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 (e.g., you don't live in a certain area or work in a certain kind 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.