The national savings rate remains at 0.28% APY, where it has been since October. The stagnant rates don’t come as a surprise since banks did not make changes to savings rates in the past month. The inaction continues to suggest that banks are reluctant to make rate changes amid the unclear direction that Federal Reserve is taking with regards to rate policy.
Currently, the top nationwide savings rate of 0.91% APY is available from SFGI Direct. GE Capital Bank and Barclays are following close behind — both are offering online savings accounts with a 0.90% APY.
Meanwhile, the U.S. economy continues to make a gradual improvement. In November, the unemployment rate fell from 7.3 percent to 7.0 percent, which is the largest month-to-month drop since late 2011.
The decline in the jobless rate is drawing more attention on the monetary policy by the central bank. The Fed noted that it would begin raising interest rates once the unemployment rate fell to 6.5 percent. Earlier, the Fed projected that the rate threshold won’t arrive until mid-2015, but it appears that we’d reach the rate threshold much sooner. If the Fed sticks to its plans, then savers could see savings rates start to climb.
Without knowing what the Fed might do, banks appear to be mimicking the Fed’s lack of action. There is speculation that the Fed will taper its bond-buying program to relieve downward pressure on interest rates and that the Fed may revise the unemployment rate threshold for hiking interest rates.
The table below shows the changes in savings rates at benchmark financial institutions from Nov. 15, 2013 to Dec. 15, 2013. By monitoring the savings rates at some of the largest U.S. banks, we get an idea of where rates at other banks and financial institutions are headed.
|Bank||Savings account||APY (as of 11/15/13)||APY (as of 12/15/13)||APY Change|
|Bank of America||Regular Savings||0.01%||0.01%||0%|
|Ally Bank||High Yield Savings||0.85%||0.85%||0%|
|Capital One 360||360 Savings||0.75%||0.75%||0%|
|American Express||Personal Savings||0.85%||0.85%||0%|
Compare the best savings rates available now with the table below: