It has been another depressing week for bonds. As the stock market continues to rally (although, I’m not really sure why?), Bond prices have fallen and yields risen (bond prices and yields have an inverse relationship). This happend in June as well. In June, some certificate of deposit interest rates increased, but that hasn’t really taken place here in July.

The highest online 1-year yields are in the 2.50% range. Good rates are in the 2.00% to 2.25% range. The yield curve is fairly flat on terms of 1-year to 3-year. There is usually a small bonus for investing in 2-years CD. Most 2-year CD rates are about 0.25% above than the 1-year, and the 3-year is usually another 0.25% above that, around 2.75%. Good 5-year rates are near 3.40 to 3.60% APY.

One interesting way to search for interest rates is to type in the rate and the year. This usually brings up a list of web pages with current online interest rates. And if, for instance, you are attempting to find the hard to find 3%, you’ll probably find it within the highest twenty or so pages. You can also search by state. For example, you could type New Jersey cd rates for high rates in NJ – New Jersey

For the time being, we will likely continue to see this back and forth between the stock market and bond market. Since the banks also understand it is a back and forth, give and take, they probably won’t respond with higher online CD Rates. I think it will take the Fed to raise Fed Funds to seriously affect CD rates. That may not happen for another 9-months. Keep in mind that short-term yields will probably increase faster than longer-term rates, at some point leaving us with a flat or almost flat yield curve. If at some point the curve inverts again (as it did in 2006/2007), I would lengthen your terms on your certificate of deposits. An inverted curve usally means lower rates are around the corner. On the other hand, I think we are in for a continued time of awful rates. The economy isn’t improving. Everytime they talk about a greenshoot, news comes out that it in reality was a brownout.

Remember to check-out best bank CD Rates

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