With Equity Markets Tanking, Investors Give Savings Accounts Another Look
As a result of equity markets tanking across the globe, investing in savings accounts has become more popular, despite low savings rates. Stock markets the past week have been a scary place to invest and today things have gotten a lot worse. In the opening minutes, the Dow Jones Industrial Average (DJIA) was down 340 points.
In the classic flight-to-quality move, investors are dumping stocks and commodities and fleeing to the safety of U.S. Treasuries. As a result, 10 year bond yields were down 32 basis points and are now under 2.00 percent. The last time we saw 10 year yields under 2.00 percent was back in May of 2013.
The dramatic decline in yields will send mortgage rates lower in the coming weeks. As for savings rates and money market rates, those rates won't be impacted by the decline in Treasury yields. Deposit account rates are dependent on when the Federal Open Market Committee (FOMC) increases the federal funds rate.
The consensus is that the FOMC will increase the fed funds rate sometime in the summer of 2015 but that may change. Retail sales for September fell an unexpected 0.3 percent and the Producer Price Index fell 0.1 percent for September. Any slowdown in growth in the U.S. may force the Fed to introduce a fourth round of Quantitative Easing (QE4) and delay increasing the fed funds rate.
On our interest rate tables, we have many banks and credit unions offering deposit rates around 1.00 percent. You can view lists of the highest rates below or you can search on the rate tables: Best Deposit Rates
Best Savings Rates
Best Money Market Rates
RatesORama.com Average Mortgage Rates