The market wasn’t the only thing to tumble in January — just look at current interest rates. But the knock-on effects for popular savings and loan products broke in favor of borrowers, not the lenders who charge them … meaning the best interest rates just got a little better.
The yield on the benchmark 10-year Treasury note rose steadily in December to peak briefly above the 3% threshold early this month. But as current interest rates show, it’s been all downhill from there.
A sense of fear and risk returning to the market boosted demand for government debt, pushing interest rates on the 10-year Treasury back down to 2.74% — a two-month low — by January’s end. (Bond prices and yields move opposite one another.)
While the best interest rates on popular savings products didn’t budge, the drop was great news for anyone shopping for a mortgage. On balance, the cost of borrowing money fell to a greater degree than what banks pay for deposits. That helps borrowers more than banks, while savers escaped losing some hard-won gains — at least for a month.
Check out our roundup of the best interest rates, current mortgage interest rates and more:
Best Interest Rates on Savings Products
Elsewhere, yields on savings products went nowhere after edging up a month ago. (Indeed, December marked the first rise in yields on savings and money market accounts in six months.)
Here are the best interest rates (shown in annual percentage yields) on some popular savings products (with a minimum deposit of less than $10,000, except for jumbo CDs) as of Jan. 29, according to Bankrate:
- National Average Rate on Interest Checking Account: 0.51%, up from 0.49% a month ago
- Best APY on No-Fee Savings Account: 1% (First Trade Union Bank), no change from a month ago
- Best APY on 1-Year CD: 1.1% (AloStar Bank of Commerce), no change from a month ago
- Best APY on 3-Year CD: 1.45% (Intervest National Bank [IBCA], $2,500 minimum), no change for four months
- Best APY on 5-Year CD: 2.16% (EverBank [EVER], $1,000 minimum), no change from a month ago
- Best APY on 5-Year Jumbo CD: 2.2% (Barclays [BCS], $100,000 minimum), up from 2.16% a month ago
Current Mortgage Interest Rates
At the same time that savers were spared rate pain, borrowers caught a break from rising mortgage rates, which declined significantly over the past month. Here are the current mortgage interest rates (overnight national average) on popular loan products as of Jan. 29, according to Bankrate:
- 30-Year Fixed Mortgage: 4.33%, down from 4.51% a month ago
- 15-Year Fixed Mortgage: 3.38%, down from 3.56% a month ago
- 5/1 Adjustable-Rate Mortgage: 3.47%, down from 3.69% a month ago
- 30-Year Fixed Mortgage, Refi: 4.33%, up from 4.13% a month ago
- $30,000 Home Equity Line of Credit: 4.81%, down from 4.84% a month ago
- $30,000 Home Equity Loan: 6.14%, up from 6.1% a month ago