CD Rates May 18: Average Rates Stable as Market Awaits Fed Minutes
CD rates are stable and there are no major moves in average rates. Don't expect rates to go higher anytime soon.
Traders believed Treasury yields would start heading higher when the Fed announced back in March that they were ending QE2 at the end of June. Since then the opposite has happened and yields have declined.
This afternoon the Fed will also release minutes from their April meeting which will probably show more of the same about the economy, slow growth, housing market concerns, etc. All will weigh down on bond yields keeping interest rates low.
10 year bond yields have declined over the past month. Back in early April 10 year bond yields were 3.60%. Yesterday's close had 10 year yields just above 3.10%. A series of weak economic data over the past month including GDP numbers and housing numbers have driven yields lower.
If the economy putters along and weak data continues to be released we won't see the anticipated bump in interest rates everyone expected when QE2 ends. What does this mean for average CD rates? Expect these low rates to continue for the foreseeable future and possibly to the end of 2011.
Average CD Rates May 18
CD (Certificates of Deposit) - 3 Month 0.23%