Top Money Market Rates at 1.41% This Week

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There are new highs for money market rates and savings rates this week. The best variable deposit rate this week is from UFB Direct at 1.40 percent with an annual percentage yield of 1.41 percent. UFB Direct's variable account is actually called a money market savings account. The minimum opening deposit is $5k.

Money Market Rates at UFB DirectMoney market rates have been moving higher for about a year now as a result of the Federal Reserve increasing the federal funds rate. The Fed is expected to continue increasing rates, therefore, deposit rates will also move higher in the coming years.

Rates moved much higher just over the summer. Back in June, the top MMA rate was at 1.15 percent, 26 basis points less than the current rate. Read the post at Rates Move Higher in 2017.

Savings rates  also moved higher since June and will increase in the coming years. In early summer, the top savings rate was at 1.30 percent. Due to the Fed's June rate increase, deposit rates moved even higher. The current best savings rate is at 1.40 percent from Dollar Savings Direct and Popular Direct. The minimum opening balance at Dollar Savings is $1.00 while the minimum at Popular is $5,000.

A stronger economy, lower unemployment, and the Federal Reserve increasing interest rates are all driving deposit rates higher. A post we did in June forecast MMA rates to be around 1.25 percent by the end of 2017, looks like the top rate will be around 1.50 percent or higher by the end of the year.

Top Money Market Rates This Week

  1. UFB Direct 1.41%

  2. EBSBDirect 1.30%

  3. EverBank 1.31%

  4. Sallie Mae 1.30%

  5. ableBanking, a division of Northeast Bank 1.30%

  6. Pacific National Bank 1.30%

  7. Northern Bank Direct 1.26%

  8. M.Y. Safra Bank, FSB 1.26%

  9. Capital One Bank 1.20%

  10. My e-BAnC 1.15%

We are looking for rates to march higher beyond 2017, especially if the Fed continues rate increases. As a result of future rate increases, by the end of 2018, variable deposit rates will probably be around 2.50 percent. By 2019, variable deposit rates will be around 3.00 percent. If Republicans are able to lower taxes, perhaps rates will be even higher as a result of higher inflation.
Author: Brian McKay
October 24th, 2017