SEATTLE— Certificate of deposit rates continue to trend lower, but the pace of declines has slowed as banks and credit unions “take a more measured approach to pricing,” according to an April analysis from CD Valet.
The company said roughly 60% of CD rate changes in the past month were decreases, down from about 70% in prior months, signaling a narrowing gap between rate cuts and increases.
CD Valet said its monthly “Ratewatcher” report analyzed more than 40,000 publicly listed CD rates from nearly 5,000 banks and credit unions nationwide, covering activity from March 2 through April 1.
“Earlier this year, the CD market was bracing for a more decisive downward rate environment,” Mary Grace Roske, head of marketing and communications at CD Valet, said in a statement. “Now, we’re seeing institutions take a more measured approach.”
Mixed Signals
Roske added that mixed signals from inflation, geopolitical pressures and economic growth are contributing to a more cautious stance among financial institutions.
According to CD Valet, the latest data suggests many institutions are:
- Holding rates steady rather than broadly cutting yields
- Selectively increasing rates to remain competitive for deposits
- Adjusting pricing strategies based on shifting economic conditions
The report found that increases were most common among shorter and mid-term CD products:
- 12-month CDs recorded the highest number of annual percentage yield (APY) increases
- 24-month and 48-month CDs also saw noticeable upward movement
- Longer-term CDs showed less aggressive pricing changes
What Trend May Indicate
The trend may indicate that institutions are more willing to offer higher yields on shorter-term deposits while remaining cautious about locking in long-term funding at elevated rates, CD Valet said.
Roske said the current environment underscores the need for financial institutions to closely evaluate deposit strategies.
“In the face of a fluid and less predictable market, now is a strong time for banks and credit unions to closely evaluate their deposit needs, strategy and pricing,” she said.
She added that while some CD yields are drifting lower, competitive offers remain available, particularly from community banks and credit unions, and consumers may benefit from comparing options and locking in rates amid ongoing uncertainty.
