It is expectable for banks and credit unions to significantly lower their savings account and CD rates in the midst of the 0% Fed interest rate environment. However, wise financial institutions would have accomplished this in one or two rate reductions, rather gradually and unpredictably lowering their rates several times per month. Consumers can understand a rate cut--even a significant one--in response to Fed rates being zeroed out. However, multiple and unpredictable rate cuts erode consumer confidence in particular financial institutions.
