Benchmark interest rates jumped over the last month but, unfortunately for savers, it helped banks more than borrowers.
The yield on the 10-year Treasury note recovered sharply after a post-presidential election nosedive, jumping to 1.76% from 1.58% as recently as Dec. 6. Although that helped to stabilize rates on some popular savings products, many key rates took a step back over the past month.
Meanwhile, rates ticked up on some of the most popular housing products. So, on balance, the net effect was one that moved against savers — again.
The Federal Reserve’s plan to smother the yield curve — keeping both savings rates and borrowing costs at historic lows — broke in consumers’ favor back in November, but it turns out that was an aberration. As we’ve been noting for months now, investors have lots of cash parked on the sidelines — and they’re still getting nothing for it.
However, if there’s a bright spot, at least savers aren’t getting any less interest on their cash deposits. Savings rates appear to have stabilized after months of trending downward. The national average interest rate on a money market account stood at 0.49% as of Dec. 25, unchanged from November or October, according to data from Bankrate.com (NYSE:RATE).
Meanwhile, yields on jumbo money market accounts also stood firm. The national average of 0.64% was likewise unchanged from a month ago. Indeed, the average rate has now held firm for three consecutive month. That follows a three-month downtrend that saw it slip from 0.66% in August to 0.65% in September to 0.64% in October.
Mostly, though, rates were unchanged or declined. Here are rates on other popular savings products as of Dec. 25, according to Bankrate:
- National Average Rate on Interest Checking Account: 0.53%, unchanged from a month ago
- Best Rate on Savings Account: 1% (Barclays [NYSE:BCS] no minimum), down 0.05% from best rate found a month ago
- Best Rate on 1-Year CD: 1.04% (Ally Bank, no minimum), down from 1.05% (Sallie Mae, $2,500 minimum) a month ago
- Best Rate on 3-Year CD: 1.3% (CIT Bank [NYSE:CIT], $1,000 minimum) down from 1.35% (Discover Bank [NYSE:DFS], $2,500 minimum) a month ago
- Best Rate on 5-Year CD: 1.7% (eloan, $10,000 minimum), down from 1.8% (CIT Bank, $1,000 minimum) a month ago
- Best Rate on 5-Year Jumbo CD: 1.85% (CIT Bank, $100,000 minimum), no change from a month ago
At the same time, although rates on some of the most common mortgage products were unchanged or moved in borrowers favors since last month, costs to refinance or borrow on homes were more likely to rise than fall.
Here are the average national rates offered on popular loan products as of Dec. 25, according to Bankrate:
- 30-Year Fixed Mortgage: 3.45%, unchanged from a month ago
- 15-Year Fixed Mortgage: 2.84%, down from 2.86% a month ago
- 5/1 Adjustable-Rate Mortgage: 2.85%, up from 2.78% a month ago
- 30-Year Fixed Mortgage, Refi: 3.51%, up from 3.41% a month ago
- $30,000 Home Equity Line of Credit: 4.57%, up from 4.55% a month ago
- $30,000 Home Equity Loan: 5.53%, down from 5.61% a month ago