Reuters
It’s taken awhile, and the returns are barely visible — but for the first time this interest-rate cycle, savings rates appear to be creeping upward.
In the week starting March 19, the average rate on a 12-month certificate of deposit of less than $100,000 was 33 basis points, according to data compiled by the Federal Deposit Insurance Corp. That’s not much, but it’s the fourth gain in seven weeks.
Savers can find better interest rates if they are willing to shop around. There are rates available online north of 2% for one-year CDs, some with no minimum deposits.
As the Fed has hiked interest rates — on Wednesday, the central bank is expected to make the sixth quarter-point rate hike of the cycle — savers have not benefited by much.
“Retail deposits as you know are sticky on the way up — they generally come up with a lag,” Federal Reserve Chairman Jerome Powell told Congress last month.
That stickiness has helped to pad bank profits. The FDIC said net interest margins during the fourth quarter reached a five-year high.
Over 12 months, the Financial Select Sector SPDR exchange-traded fund XLF, +0.24% has gained 18%, just a few ticks better than the gain for the Dow Jones Industrial Average DJIA, +0.47% .