Best CD Rates- Search for CD Rates
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CD rates are slowing moving higher and will continue to increase in 2017. The Federal Reserve has forecast the need to increase the fed funds rate at least three times in 2017 and possibly more, if needed. These increases will put upward pressure on both short term and long term CD rates.
Listed below are the best CD rates currently available for certificate of deposit terms ranging from 3 months to 60 months. Also listed below are current average CD rates for CD terms between 3 months and 5 years.
Best CD Rates Available as of December 30, 2016
Average CD Rates as of December 30, 2016
You can see a complete list of CD rates for all CD terms by searching our CD rates tables at MonitorBankRates.com.
CD rates are slowly inching higher and will continue to move higher in the coming months. A more immediate impact that will force CD rates higher is the Federal Open Market Committee increasing rates. The FOMC meets this week to decide on monetary policy and is widely expected to increase the fed funds rate by 25 basis points.
The CME Group’s FedWatch Tool has a 97.2 percent probability that the Fed will increase the rate to a range of 0.50 percent to 0.75 percent. The last time the Fed increase the rate was December 2015 when the rate was increased to a range of 0.25 percent to 0.50 percent.
Several banks already increased CD rates on short term certificates of deposit recently, likely in anticipation of a Fed rate hike. The highest CD rates on 1 year certificates of deposit are approaching 1.50 percent and may hit 1.50 percent after the expected rate hike.
Currently, the best 1 year CD rates on our rate list are from Pentagon Federal Credit Union at 1.35 percent with a yield of 1.36 percent. The best 1 year rate offered on our list of from a bank is from VirtualBank at 1.30 percent with a yield of 1.31 percent.
The highest 2 year CD rates on the list are already above 1.50 percent. Two banks, EverBank and Virtual Bank are offering 2 year CD rates at 1.51 percent with a yield of 1.52 percent. We could see the top 2 year rates increase above 1.60 percent in the coming weeks.
At what pace CD rates rise in the coming year will be mostly dependent on how much and how quickly the Fed increases the fed funds rate. As of this morning, the FedWatch Tool has a probability of one rate hike in 2017, putting the rate between 0.75 percent and 1.00 percent.
The Fed’s own projections for the fed funds rate for 2017 is all over the place. Advance projections for this week’s meeting put the rate between 1.875 percent and 3.375 percent with the majority between 1.875 percent and 2.625 percent.
The Fed’s own projections are a lot higher than the FedWatch Tool, which is the market’s view on where the fed funds rate will be by the end of 2017. Unless there is a recession next year, CD rates will finally be moving higher.
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