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Top CD Rates Hold Steady First Week of May

May Top CD Rates Hold SteadyThe top CD rates in May hold steady as a better April Employment Report sent long term bond yields higher last week. There will be no big uptick in short term or long term CD rates until the Federal Open Market Committee (FOMC) increases the fed funds rate. We are slowly inching closer to a higher fed funds rate as the nation's unemployment rate drops.

The unemployment rate in the month of April fell to 7.5 percent, down from March's rate of 7.6 percent. The FOMC has stated they plan to keep the fed funds rate just above zero percent until the unemployment rate falls to 6.5 percent. I believe the rate will fall to 6.5 percent sometime in the second quarter of 2014 or sooner.

If the rate falls to the 6.5 percent level in the second quarter of 2014, the Fed will quickly act to increase the fed funds rate to a neutral level. A higher fed funds rate will mean higher CD rates a few months after. Looks for rates to finally increase again sometime in the third or fourth quarter of 2014.

Here is a list of the highest CD rates for the Month of May:

  • 1 Month CD Rate Lone Star Bank and Virtual Bank at 0.15%

  • 2 Month CD Rate E-Loan at 0.20%

  • 3 Month CD Rate EverBank at 0.46%

  • 6 Month CD Rate Doral Direct at 0.88%

  • 9 Month CD Rate Doral Direct at 0.92%

  • 12 Month CD Rate GE Capital Retail Bank at 1.04% 1.05% APY

  • 18 Month CD Rate Doral Direct at 1.03% APY 1.03%

  • 24 Month CD Rate CIT Bank at 1.19% APY 1.20%

  • 30 Month CD Rate Lone Star Bank at 1.09% APY 1.10%

  • 36 Month CD Rate Virtual Bank at 1.30% APY 1.31%

  • 48 Month CD Rate Nationwide Bank at 1.45% APY 1.46%

  • 60 Month CD Rate Nationwide Bank at 1.59% APY 1.60%

Author: Brian McKay
May 6th, 2013