Economic data released in the last week has slightly raised the chance of a Fed rate hike in March. Last Wednesday, the Labor Department released the Consumer Price Index for January. The CPI increased 0.6% last month which was much higher than the expected 0.3% increase. The core CPI increase also exceeded expectations (0.3% vs 0.2%). The retail sales report was also released last Wednesday, and the report showed that sales increased more than expected in January. This gives the Fed some justification to raise rates at its next FOMC meeting on March 14-15.
In addition to the economic data, Fed Chair Janet Yellen sounded a little more hawkish than expected at last week’s Senate meeting which suggested that the Fed may seriously consider a rate hike at its March meeting.
A few more clues about the March meeting may come on Wednesday when the Fed releases the minutes from the last FOMC meeting.
The chance of a March rate may be increasing, but it’s still rather low. According to the Fed funds futures contracts, the implied probability of at least one quarter-percent rate hike in March increased from 17.7% last week to 22.1% today.
Most all Treasury yields declined from last week with the 5-year falling the most (5 bps).
- 1-month: 0.49% down from 0.51% last week
- 6-month: 0.69% up from 0.66% last week
- 2--year: 1.22% down from 1.25% last week
- 5--year: 1.93% down from 1.98% last week
- 10-year: 2.43% down from 2.47% last week
- 30-year: 3.04% down from 3.07% last week
Fed funds futures' probabilities of future rate hikes by:
- Mar 2017 - at least one hike: 22.1% up from 17.7% last week
- Mar 2017 - at least two hikes: 0.0% same as last week
- Jun 2017 - at least one hike: 74.8% up from 68.0% last week
- Jun 2017 - at least two hikes: 28.5% up from 21.4% last week
- Dec 2017 - at least one hike: 95.8% up from 94.7% last week
- Dec 2017 - at least two hikes: 77.1% up from 73.0% last week
Savings & Checking Account Rates
Savings and money market rates continue to be disappointing. I had hopes we would see more upward movements after the December Fed rate hike. In the last two weeks, there were just two changes to the top nationally available savings and money market accounts listed below, and one of those changes was a rate cut.
The one positive change was the addition of the Money Market Deposit Account at Pacific National Bank. The bank recently increased the APY of this money market account from 1.00% to 1.06%. This account can be opened online by people from any state, and its minimum balance is only $100.
The one rate cut was at California First National Bank which lowered its money market checking account rate from 1% to 0.75%.
For the 1% club, the rate cut at California First National Bank offsets the addition of Pacific National Bank. Thus, the number of accounts in the 1% club remains at 22. The 1% club is the group of nationally available checking, savings and money market accounts that have rates of at least 1% APY. I exclude accounts that have promotional rates that are scheduled to fall after a certain amount of time. Also, I exclude accounts in which the 1%+ rate is available only for new customers. The ones on the promotional category include EverBank, The Palladian PrivateBank, Northeast Bank, iGObanking.com’s MMA and Salem Five Direct.
Reward Checking Accounts
Banks and credit unions are also in a holding pattern with their reward checking accounts. There were just two changes in the nationally available reward checking list.
The first change was a rate increase at Avidia Bank. The APY of its reward checking account, called eChecking, increased from 1.06% to 1.41% for balances up to $25,000.
The other change was the addition of Westfield Bank’s Dream Big Checking. This reward checking account earns 1.66% APY for balances up to $15k. Westfield is based in Ohio, but it’s currently
allowing people in any state to open this account online. Another perk with this account is a $100 new-account bonus (see blog post). Update 2/22: Westfield Bank has changed their policy. They are now only accepting applications from Ohio residents.
To find the highest reward checking rates and balance caps in your state or nationwide, please refer to our reward checking rate table. If you're new to reward checking, please refer to my blog post, Overview of Reward Checking & Our Reward Checking Table.
Certificate of Deposit Rates
I’m now publishing my CD survey as a separate post. Please refer to my survey of the best CD rates. This recap will focus on banking news of the week and liquid accounts.
Hot CD Deals: I just wanted to include this reminder of three hot CD deals that are still available:
The first is Navy Federal’s special 17-month CD. Two things make this a hot deal: a 2.00% APY and an add-on feature that allows any number of additional deposits. The one caveat is that there’s a maximum balance of $50,000. If you’re not already a Navy Fed member, there’s a good chance you can join. Please refer to this blog post for more details.
The second hot CD deal is at Andrews FCU. It’s offering a 7-year CD with a 3.00% APY. What makes this deal hot is its mild early withdrawal penalty of only 6 months’ interest. I have more details in this blog post.
The third hot CD deal is at Mountain America Credit Union which is offering a 5-year CD (2.75% APY) with a one-time bump option (see blog post).Rates as of February 21, 2017
Checking/Savings/Money Market Accounts:
- Best Savings Account Rates (Nationwide and by State)
- Best Money Market Rates (Nationwide and by State)
- Best Checking Account Rates (Nationwide and by State)
- Noteworthy Accounts Available Nationwide:
|The Palladian PrivateBank||1.30% (6mo intro rate) 1.10% blended APY||Savings Account - Account review|
|Redneck Bank||1.25% (up to $35k), 0.50% ($35k+)||Mega Money Market Account|
|Popular Direct||1.15%||High Rise Savings - Account review|
|MyBankingDirect||1.15% ($25k min), 0.75% ($5k min)||Earn >More Money Market|
|Connexus Credit Union||1.15% ($100k), 1.00% ($50k,) 0.75% ($20k)||MMA - active chk required|
|Self-Help Federal Credit Union||1.14% ($500k), 1.04% ($500)||Money Market - Account review|
|Northpointe Bank||1.12% ($10k min, 12 month rate guarantee)||UltimateSavings - Account review|
|EverBank||1.11% (1yr intro rate) 0.61% ongoing rate||MMA/Checking - Account review|
|Incredible Bank||1.11% ($2.5k), 0.05% ($250k+)||IncredibleBank Savings - Account review|
|Northeast Bank||1.10%||Pearl Money Market Promo, new customers - Account review|
|Dime Savings Bank||1.10%||Dime Direct Money Market, new money - Account review|
|iGObanking.com||1.10% ($25k min)||MMA, New accounts and new money only, Account review|
|Salem Five Direct||1.10%||eOne Savings, for new customers only Account review|
|SFGI Direct||1.06%||Savings account - Account review|
|Pacific National Bank||1.06%||Money Market Deposit Account - See review|
|McGraw-Hill Federal Credit Union||1.05% (rate guarantee through 4/30/17)||Holiday Money Market Promo - See review|
|CIT Bank||1.05%||High Yield Savings - Account review|
|SmartyPig||1.05% ($50k min), 0.85% ($2.5k min)||Savings account - Account review|
|AloStar Bank of Commerce||1.05%||Savings account - Account review|
|GS Bank||1.05%||Online savings account|
|Synchrony Bank (formerly GE Capital Retail Bk)||1.05%||High Yield Savings|
|Sallie Mae Bank||1.05%||MMA - Account review|
|ableBanking||1.00%||Money Market Savings|
|iGObanking.com||1.00%||Savings account - Account review|
|Barclays||1.00%||Savings - Account review|
|Ally Bank||1.00%||Online Savings|
|Alliant Credit Union||1.00% ($100 min)||Savings account - Account review|
|Radius Bank||1.00% ($2.5k min)||Radius High-Yield Savings - Account review|
|Capital One 360||1.00% ($10k+), 0.60% (up to $10k)||360 Money Market - Account review|
|UFB Direct||1.00% ($25k min)||UFB Savings - Account review|
|FNBO Direct||0.95%||Savings account|
|Discover Bank||0.95% ($500 min)||Savings account - Account review|
|Incredible Bank||0.95% ($2.5k min)||MMA - Account review|
|Bank5 Connect||0.90% ($100 min)||Online savings account (not available for MA and RI residents)|
|Capital One 360||0.90% ($100k) 0.75% ($50k)||360 Checking|
|TIAA Direct||0.90% ($100k)||MMA|
|American Express Bank||0.90%||Savings account - Account review|
|Clear Sky Accounts||0.90% ($250k max)||Savings account - Account review|
|Colorado Federal Savings Bank||0.85% ($2.5k min)||Savings account - Account review|
|Synchrony Bank (formerly GE Capital Retail Bk)||0.85%||MMA|
|Sallie Mae Bank||0.85%||Upromise GoalSaver Account|
|MySavingsDirect||0.85%||MySavings account - Account review|
|Discover Bank||0.85% ($100k min) 0.80% ($2.5k)||MMA - Account review|
|Digital Credit Union||0.80% ($100k) 0.65% ($50k)||MMA|
|Bank5 Connect||0.76% ($100 min)||Checking account (not available for MA and RI residents)|
|California First National Bank||0.75%||Money Market Checking - Account review|
|Bank of Internet USA||0.75%||MMA|
|Capital One 360||0.75%||360 Savings account|
|Quorum Federal Credit Union||0.70%||HighQ Savings Account|
|TIAA Direct||0.65%||High Yield Savings account|
|FNBO Direct||0.65%||Checking account|
|Alliant Credit Union||0.65%||Checking (req's elec. dep & e-stmts) Account review|
|MyCBB||0.60%||MyCBB Money Market - Account review|
|Incredible Bank||0.59% ($1k min)||Checking - Account review|
|Elements Financial (formerly Eli Lilly Credit Union)||0.55% ($10k min)||Helium Savings - Account review|
|Nationwide Bank||0.50% ($1k min)||MMA|
|Citizens State Bank (FL)||0.50% ($50k) 0.25% ($10k)||Internet Savings|
Reward Checking Accounts:
- Noteworthy Accounts Available Nationwide:
|Consumers Credit Union||4.59% (up to $20k)||Rewards Checking - debit card and $1k credit card requirements|
|Consumers Credit Union||3.59% (up to $15k)||Rewards Checking - debit card and credit card requirements|
|One American Bank||3.50% (up to $10k), 0.25% ($10k+)||Kasasa Cash - Account review|
|Consumers Credit Union||3.09% (up to $10k)||Rewards Checking - debit card with NO credit card requirements|
|Lake Michigan Credit Union||3.00% (up to $15k), 0.00% ($15k+)||Max Checking|
|Great Lakes Credit Union||3.00% (up to $10k), 0.10% ($10k+)||Ultimate Checking|
|American Bank & Trust||2.51% (up to $10k), 0.25% ($10k+)||Kasasa Cash|
|Mid-Illini Credit Union||2.50% (up to $25k), 0.15% ($25k+)||Cash Rewards High Interest Checking - Account review|
|Industrial Bank||2.50% (up to $15k), 0.25% ($25k+)||Kasasa Cash|
|Capital Educators Federal Credit Union||2.50% (up to $10k), 0.20% ($10k+)||High Yield Checking|
|Bellco Credit Union||2.25% (up to $25k), 0.25% ($25k+)||Boost Interest Checking - Account review|
|Main Street Bank||2.25% (up to $25k), 0.25% ($25k+)||Kasasa Cash - Account review|
|Altra Federal Credit Union||2.25% (up to $15k), 0.50% ($15k+)||A+ Checking|
|Coastal Federal Credit Union||2.25% (up to $10k), 0.10% ($10k+)||Go Green Checking - Account review that includes companion Go Green MMA|
|TruStone Financial Credit Union||2.02% (up to $20k), 0.10% ($20k+)||TruRate Checking - Account review|
|BankFirst||2.02% (up to $10k), 0.15% ($10k+)||Kasasa Cash|
|Finex||2.018% (up to $25k), 0.20% ($25k+)||Axcess Rewards Checking, Premier Account (formerly First New England Federal Credit Union)|
|XCEL Federal Credit Union||2.01% (up to $25k), 0.30% ($25k+)||Kasasa Cash Checking|
|Legence Bank||2.01% (up to $10k), 0.25% ($10k+)||Kasasa Cash|
|Bay State Savings Bank||2.01% (up to $20k), 0.25% ($20k+)||Kasasa Cash - Account review|
|Country Bank||2.00% (up to $20k), 0.25% ($20k+)||Kasasa Cash Checking Account review|
|Elements Financial||2.00% (up to $20k), 0.10% ($20k+)||High Interest Checking - Account review|
|MainStreet Bank||2.00% (up to $15k), 0.25% ($15k+)||Kasasa Cash - Account review|
|Blue Federal Credit Union||2.00% (up to $15k), 0.25% ($15k+)||Extreme Checking (up to 4% w/account relationships) - Account review|
|KS StateBank||1.95% (up to $25k), 0.50% ($25k+)||Check PLUS - Account review|
|Connexus Credit Union||1.75% (up to $25k), 0.25% ($25k+)||Xtraordinary Checking|
|First Tech Federal Credit Union||1.58% (up to $10k), 0.16% ($10k+)||Dividend Rewards Checking|
|MemoryBank||1.50% (up to $250k)||EarnMore Interest Checking - Account review|
|All America Bank||1.50% (up to $10k), 0.50% ($10k+)||Ultimate Rewards Checking|
|ABCO Federal Credit Union||1.26% (up to $25k), 0.20% ($25k+)||Premiere Checking|
|Heritage Bank||1.26% (up to $25k), 0.10% ($25k+)||eCentive Account|
|Bank of Internet USA||1.25% (up to $150k), 0.00% ($150k+)||Rewards Checking|
|Community Bank of Raymore||1.01% (up to $10k), 0.20% ($10k+)||Kasasa Cash|
|Community Bank of Pleasant Hill||1.01% (up to $10k), 0.20% ($10k+)||Kasasa Cash|
|First American Bank||1.00% (up to $15k), 0.13% ($15k+)||Everyday Rewards Checking|
|Bank of Blue Valley||1.00% (up to $10k), 0.10% ($10k+)||$1k/month debit card req (formerly Ultimate Checking)|
Certificates of Deposit:
- Best CD Rates (Nationwide and by State)
- Best IRA CD Rates (Nationwide and by State)
- Survey of the Best CD Rates (Nationwide and Local)
Bank Account Alternatives - NOT FDIC Insured
|Ally Financial Demand Notes||1.15% rate for $50k+|
|Duke Energy PremierNotes||1.05% rate for $50K+||Duke Energy PremierNotes review|
|Ford Interest Advantage||1.05% rate for $50k+||Ford Interest Advantage review|
|Vanguard Prime Money Market Fund||0.79% 7-day yield|
|Vanguard Tax-Exempt Money Market Fund||0.55% 7-day yield|
|Fidelity Money Market Fund||0.69% 7-day yield||reviews on Fatwallet|
|Fidelity Municipal Money Market Fund||0.37% 7-day yield|
Post Publication Edits
2/22/17: Westfield Bank Dream Big Checking removed; now only available to Ohio residents.
2/23/17: Quorum Federal Credit Union HighQ Savings Account lowered.
2/24/17: Avidia Bank eChecking removed; now only available to Massachusetts residents.