Best CD, MM Rates & Bank Special Deals Thread 2023 - Please post updates here

[Car-Guy]

It is a bit disappointing that we have not breached the highs from March on the 5YR CDs. They seem a bit non-competitive.

Yep, the yield curve just doesn't seem to want to flatten. I guess that's telling us something about the longer term outlook for rates.

 

[Montecfo]

the recent move in yields higher seems confined to the short end, treasuries and junk. i can add a rung to my step ladder but hardly seems necessary with short rates so high relatively speaking.

The Fed will be reluctant to say they are done raising but I expect they are. That is what they did with the "higher for longer' pivot. I think it actually means "this high for a while". they think it will take 1-2 years to get back to 2%.

It could. But the inflation measures moving steadily in the right direction for s while now. PCE dropped pretty sharply over the past 4 months. And the ec0nmic signs point to slower growth. They do not want to overshoot but a soft landing is not their base case.

So Fed rates may be "this high for a while" but unlikely to go a lot higher it seems to me.

 

[copyright1997reloaded]

It is a bit disappointing that we have not breached the highs from March on the 5YR CDs. They seem a bit non-competitive.

If I were looking to lock in a 5-year term, I would likely buy the April 2028 TIPS, CUSIP 91282CGW5. As of right now, they can be picked up @ 94.535 /100, and are showing a real yield of 2.535%. With 5-year T-NOTES trading with a 4.746 yield, this makes the inflation expectation roughly 2.211% per year.

I would take that bet (i.e. that inflation will be greater than 2.211% per year over the next 5 years).

I've been watching the 5 and 10 year TIPS real returns move steadily higher, and they have moved from 1.92% real on the 10-year TIPS to 2.395% as of this moment. Quite the climb, which is why I haven't jumped yet (the trend is my friend here in terms of getting a higher real return).

 

[Car-Guy]

the recent move in yields higher seems confined to the short end, treasuries and junk. i can add a rung to my step ladder but hardly seems necessary with short rates so high relatively speaking.

The Fed will be reluctant to say they are done raising but I expect they are. That is what they did with the "higher for longer' pivot. I think it actually means "this high for a while". they think it will take 1-2 years to get back to 2%.

It could. But the inflation measures moving steadily in the right direction for s while now. PCE dropped pretty sharply over the past 4 months. And the ec0nmic signs point to slower growth. They do not want to overshoot but a soft landing is not their base case.

So Fed rates may be "this high for a while" but unlikely to go a lot higher it seems to me.

Pretty much agree, and if it does move higher, it will just be a little and not enough to make much difference. The question I'm asking myself is how long will current rates hold "at or near where they are now". I'm thinking (hope) 6 mos or more since I've got a lot of short term CD's maturing between now and the next 6 months that I'll need to re-invest.

 

[Montecfo]

those do look interesting copyright, I agree.

And I am shopping out 8-10 years.

 

[Montecfo]

Pretty much agree, and if it does move higher, it will just be a little and not enough to make much difference. The question I'm asking myself is how long will current rates hold "at or near where they are now". I'm thinking (hope) 6 mos or more since I've got a lot of short term CD's maturing between now and the next 6 months that I'll need to re-invest.

Key question I think is how does the yield curve revert? With higher long rates or lower short rates.

Historically, it has been lower short rates, but we will see.

After looking at CDs and agencies, I conclude treasury rates are rising somewhat do to the large supply coming online. Other rates seem to not have adjusted in the same way. I would expect they would or perhaps the treasury move is very temporary.

The oft-predicted fire sale of bond fund selling seems to have not happened, at least to my eye.

 

[copyright1997reloaded]

those do look interesting copyright, I agree.

And I am shopping out 8-10 years.

10 year TIPS real rate (real time): https://www.cnbc.com/quotes/US10YTIP

Let me know if you go for some of these...I own a bit of it (from the intial auction, it is now quite a bit under water but will likely add to the position if the real rates keep rising.)

ETA: Last September I drew this very simple support line on the TLT chart. Back then, it was a note to myself not to go long if the $TLT support broke. Once it did, I occasionally rlook at it to remind myself. Honestly, I should print it out and tape it to my forhead everytime I've wanted to go big on any long term bond...as I've made a few "mistakes" and bought an occasional 5/10 year. (Not big, I would guess < 2% of my total net worth.) Eventually, sometime, it will be good to go big and lock in longer term...but this ugly chart (which keeps getting uglier) is a good reason to hesitate.

http://tos.mx/M6h4K4C

 

[NomDeER]

It is a bit disappointing that we have not breached the highs from March on the 5YR CDs. They seem a bit non-competitive.

the recent move in yields higher seems confined to the short end, treasuries and junk.

At the beginning of August, the best rate I could find for 5-year non-callabe CDs was 4.5% and they are now at 4.8%. The best rate I could find then for 4-year non-callable CDs was 4.6% and they are now at 4.9%. So, they have edged up a bit.

I am debating whether it makes sense to buy any of these now. Is it better to just stay in my money market where I am getting a better yield? Should I wait for better CD yields? Should I use the cash to invest in a better crystal ball?

 

[Chuckanut]

At the beginning of August, the best rate I could find for 5-year non-callabe CDs was 4.5% and they are now at 4.8%. The best rate I could find then for 4-year non-callable CDs was 4.6% and they are now at 4.9%. So, they have edged up a bit.



I am debating whether it makes sense to buy any of these now. Is it better to just stay in my money market where I am getting a better yield? Should I wait for better CD yields? Should I use the cash to invest in a better crystal ball?

Spread your risks. Split the cash in half. Buy a five year now and then watch for a better deal in the next few months.

 

[Dtail]

It is a bit disappointing that we have not breached the highs from March on the 5YR CDs. They seem a bit non-competitive.

Still think the magic yield number for the 5 year is 5% and there will be a sell out of any CD offerings at this level.

 

[audreyh1]

It is a bit disappointing that we have not breached the highs from March on the 5YR CDs. They seem a bit non-competitive.

March had a mini banking crisis which forced several banks ro shore up deposits which meant higher rates offered. Those offers dropped back down shortly thereafter when the dust had settled.

 

[Marc]

March had a mini banking crisis which forced several banks ro shore up deposits which meant higher rates offered. Those offers dropped back down shortly thereafter when the dust had settled.

If MTM caused the issues back in March, the current spike in 10yr and 30yr treasury bonds must be causing consternation in many banks large and smalll. I wonder who will be next to fail.

Marc

 

[Spock]

If MTM caused the issues back in March, the current spike in 10yr and 30yr treasury bonds must be causing consternation in many banks large and smalll. I wonder who will be next to fail.

Marc

The Fed has a money printing program for that - Bank Term Funding Program. Banks can borrow against their inventory of under water T's, agency, and MBS to the Fed and get full par value vs. the reduced market value. On the original plan it was a 1 year loan. But usage of the program is still increasing and there isn't any other activities taking place fill the hole in bank balance sheets so the expectation is the program will be extended until rates fall again.

 

[Montecfo]

At the beginning of August, the best rate I could find for 5-year non-callabe CDs was 4.5% and they are now at 4.8%. The best rate I could find then for 4-year non-callable CDs was 4.6% and they are now at 4.9%. So, they have edged up a bit.



I am debating whether it makes sense to buy any of these now. Is it better to just stay in my money market where I am getting a better yield? Should I wait for better CD yields? Should I use the cash to invest in a better crystal ball?

Edged up but below the highs of March.

 

[Montecfo]

The Fed has a money printing program for that - Bank Term Funding Program. Banks can borrow against their inventory of under water T's, agency, and MBS to the Fed and get full par value vs. the reduced market value. On the original plan it was a 1 year loan. But usage of the program is still increasing and there isn't any other activities taking place fill the hole in bank balance sheets so the expectation is the program will be extended until rates fall again.

Good point.

This should prevent external liquidity issues and probably holding down CD rates.

 

[ShokWaveRider]

We are waiting for the elusive %5 - 4 or 5 year non-callable CDs to emerge.

 

[mz44]

We are waiting for the elusive %5 - 4 or 5 year non-callable CDs to emerge.

Buying 2 and 7 year treasuries will get you close to that.

 

[ShokWaveRider]

Buying 2 and 7 year treasuries will get you close to that.

I forgot to mention with monthly income.

 

[pb4uski]

I forgot to mention with monthly income.

Money is fungible. I keep some liquidity in a 4.3% online savings account. Semi-annual interest payments could go into that online savings account with monthly withdrawals for spending. This mechnism effectively converts semi-annual income to monthly income with negligible drag.

 

[check6]

AMEX seems to lag in their CD rates. I am getting 5.30% for an 11-month CD thru Wings Financial CU.

My Wings 3.21% CD is maturing and they are offering a 12 mth trade up to 5.40% with no penalty for early withdrawal.

 

[audreyh1]

My Wings 3.21% CD is maturing and they are offering a 12 mth trade up to 5.40% with no penalty for early withdrawal.

Wow, nice offer!

 

[Car-Guy]

My local banks CD rates. Not sure if they have many (any) takers. I guess if someone doesn't know better maybe.


Term Interest Rate Annual Percentage Yield
3 Month CD 0.50% 0.50%
6 Month CD 0.60% 0.60%
9 Month CD 4.88% 5.00%
12 Month CD 4.31% 4.40%
18 Month CD 1.05% 1.06%
24 Month CD 1.10% 1.11%
36 Month CD 1.10% 1.11%
48 Month CD 1.10% 1.11%

 

[badatmath]

I know some older folks who would only use a local bank so that 9 month might appeal to them

 

[Chuckanut]

My local banks CD rates. Not sure if they have many (any) takers. I guess if someone doesn't know better maybe.


Term Interest Rate Annual Percentage Yield
3 Month CD 0.50% 0.50%
6 Month CD 0.60% 0.60%
9 Month CD 4.88% 5.00%
12 Month CD 4.31% 4.40%
18 Month CD 1.05% 1.06%
24 Month CD 1.10% 1.11%
36 Month CD 1.10% 1.11%
48 Month CD 1.10% 1.11%

I hope their loan rates are proportional to their CD rates.

 

[Dtail]

My local banks CD rates. Not sure if they have many (any) takers. I guess if someone doesn't know better maybe.


Term Interest Rate Annual Percentage Yield
3 Month CD 0.50% 0.50%
6 Month CD 0.60% 0.60%
9 Month CD 4.88% 5.00%
12 Month CD 4.31% 4.40%
18 Month CD 1.05% 1.06%
24 Month CD 1.10% 1.11%
36 Month CD 1.10% 1.11%
48 Month CD 1.10% 1.11%

More folks than one would imagine.