*Indicates the highest APY offered in each term. To view our lists of the top-paying CDs across terms for bank, credit union, and jumbo certificates, click on the column headers above.
Despite the suggestion that a larger deposit entitles you to a higher return, that’s not always the case for jumbo certificate rates, which often pay less than standard CDs. Though today’s best jumbo offers, which typically require a deposit of $100,000 or more, beat the best standard rates in four CD terms, you can do just as well or better in the other four terms with a standard CD. So always be sure to shop every certificate type before making a final decision.
Will CD Rates Climb Higher This Year?
CD rates are already at record levels, but it’s possible they could edge higher still. That’s because the Federal Reserve announced another 0.25% increase in the federal funds rate on July 26, and it will hold at that level until at least Sept. 20. That matters because the central bank’s benchmark rate is a direct driver of the yields that banks and credit unions are willing to pay customers for their deposits.
Since March 2022, the Federal Reserve has been aggressively combating decades-high inflation, with 11 hikes to the fed funds rate over the past 12 meetings. With the latest bump, the cumulative increase totals 5.25% and brings the fed funds rate to its highest level since 2001. That’s created excellent conditions for CD shoppers, as well as for anyone holding cash in a high-yield savings or money market account.
The Fed’s official July announcement provided no strong indications on whether it will raise its benchmark rate even higher this year. The written statement simply reiterated the Fed’s commitment to bring inflation back down to its target level of 2%.
In his post-announcement press conference, Federal Reserve Chairman Jerome Powell indicated that the rate-setting committee has not made any decisions yet on whether to raise rates again in 2023, or if so, what timing or pace any increases would follow. He specifically stated that both a hike and a pause were possibilities at the next meeting, scheduled for September 19-20.
Three Fed governors have made public remarks over the past two weeks about their expectations on whether the committee will raise or hold rates going forward. While two emphasized the need to watch the upcoming data and decide on a course meeting-by-meeting—including the possibility of implementing another increase—the third indicated that unless something unexpected crops up in the data, he foresees rates being held without any further increases.
Since their remarks, new monthly inflation data has been released, with last week’s report showing that core inflation is cooling. While the Fed will also be looking to other economic indicators between now and its next meeting, this latest inflation news could lead them to a rate pause, rather than another hike, in September.
As we can see from today’s movement, it’s certainly possible the July hike could still move CD rates higher. Then again, it’s possible the impact is already behind us, since the Fed’s move had been nearly certain for weeks in advance and many banks and credit unions have already boosted their rates. In any case, when it finally appears the Fed is ready to fully stop its rate-hike campaign, that will signal that CD rates have likely maxed out.
Note that the “top rates” quoted here are the highest nationally available rates Investopedia has identified in its daily rate research on hundreds of banks and credit unions. This is much different than the national average, which includes all banks offering a CD with that term, including many large banks that pay a pittance in interest. Thus, the national averages are always quite low, while the top rates you can unearth by shopping around are often five, 10, or even 15 times higher.
Rate Collection Methodology Disclosure
Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs to customers nationwide and determines daily rankings of the top-paying certificates in every major term. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the CD’s minimum initial deposit must not exceed $25,000.
Banks must be available in at least 40 states. And while some credit unions require you to donate to a specific charity or association to become a member if you don’t meet other eligibility criteria (e.g., you don’t live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.