Current Savings Account Rates Won’t Go Higher Until 2014
Anyone searching for the best savings rates knows how low savings rates have been the past several years. Interest rates on all deposit accounts including bank CD rates and money market rates are low. If you're in the market for a mortgage you're in luck since mortgage rates are also hear record lows.
Don't expect deposit rates to increase anytime soon. I guess if you want a positive take on rates the FDIC's national savings rate average has been at 0.10% since January. The highest savings rates around from national banks includes EverBank at 0.91%, ING Direct at 0.80%, American Express Savings at 0.75% and FNBO Direct Savings at 0.65%.
Rates are so low there is no where to go but up. The big question is when will savings account rates and all deposit rates move higher. The answer to that question is the Fed.
Current Savings Account Rates Won't Go Higher Until 2014
Over the past couple of FOMC meetings the Fed has come out and said they plan to keep the Federal Funds rate near 0% until 2014. If the Fed Funds rate is at 0% banks won't increase savings rates.
In order for the Fed Funds rate to move higher and deposit rates the economy has to move at a faster clip. Once the economy gets moving and inflation becomes a concern the Fed has to raise the Fed Funds rate.
The Fed has a dual mandate of low unemployment and low inflation. The past several years unemployment and deflation (when prices decrease) has been the Fed's concern. As a result, the Fed has kept interest rates near 0% to lower the unemployment rate and help us from falling into a deflationary economy.
You can search for and compare the best savings account rates right here: Best Savings Account Rates.
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