Interest rates swooned in the back half of the month, taking yields and prices on savings and loan products with them — for the most part.
Interest paid on popular savings products either dipped slightly or remained unchanged in October, but then mortgages and other loan products got a bit cheaper too.
The net result was that changes in the interest rate environment ended essentially in a tie between banks and their customers.
The yield on the benchmark 10-year Treasury note started the month at 2.62% and rose as high as 2.72% before reversing course. By the end of October, the rate had cooled off to 2.52%. The government shutdown and the nomination of a dovish new chief for the Federal Reserve put any tapering of the Fed’s monetary stimulus program off the table for now, which pushed down bond yields.
Savings and loan products responded with mixed and muted results.
Money markets — a popular place to stash cash — broke a six-month streak of declines. The national average interest rate on a money market account was unchanged at 0.4% as of Oct. 29, according to data from Bankrate.com (RATE). As recently as August, it stood at 0.43.
However, yields on jumbo money market accounts continued their downward trend after stabilizing over the summer. The national average rate declined to 0.53% as of Oct. 28 from 0.54% a month ago. The rate hasn’t been above 0.6% since July and has been in decline for a year.
Elsewhere, yields on savings products were either unchanged or declined slightly. Here are the annual percentage yields on some popular savings products as of Oct. 28, according to Bankrate:
- National Average Rate on Interest Checking Account: 0.48%, down from 49% a month ago
- Best Rate on No-Fee Savings Account: 0.9% (Barclays [BCS], no minimum), no change for five months
- Best Rate on 1-Year CD: 1.05% (GE Capital Bank [GE], $500 minimum), down from 1.1% a month ago
- Best Rate on 3-Year CD: 1.45% (Intervest National Bank [IBCA], $2,500 minimum), no change from a month ago
- Best Rate on 5-Year CD: 2% (Barclays, no minimum), down from 2.05% a month ago
- Best Rate on 5-Year Jumbo CD: 2% (State Farm Bank $100,000 minimum), down from 2.01% a month ago.
At the same time, the most common mortgage and home loan products became less expensive — a welcome extension of last month’s downtrend. Here are the overnight national average rates offered on popular loan products as of Oct. 28, according to Bankrate:
- 30-Year Fixed Mortgage: 4.15%, down from 4.32% a month ago
- 15-Year Fixed Mortgage: 3.21%, down from 3.38% a month ago
- 5/1 Adjustable-Rate Mortgage: 3.3%, down from 3.63% a month ago
- 30-Year Fixed Mortgage, Refi: 4.13%, down from 4.3% a month ago
- $30,000 Home Equity Line of Credit: 4.77%, down from 4.91% a month ago
- $30,000 Home Equity Loan: 6.15%, down from 6.27% a month ago