Rising Inflation Drives Surge in Certificate of Deposit Rates
Certificate of Deposit (CD) rates are trending upward as inflation pressures intensify. According to data from CD Valet, 91% of recent rate changes have been increases, meaning rate hikes now outnumber decreases by nearly 10 to 1. This shift follows a hot Consumer Price Index (CPI) report showing September inflation rose to 3.7% year-over-year, driven largely by a 9.1% spike in gasoline prices. The availability of high-yield options has expanded significantly, with the number of CDs offering at least 4.00% APY jumping 86% between late September and mid-October. While longer-term products like 24-month CDs currently offer some of the highest top-end yields, market analysts suggest savers should remain strategic by comparing local versus online rates and considering CD ladders to manage potential future rate volatility.
Topics: CD rates consumer price index CPI Federal Reserve inflation