Steve Garmhausen

1 month ago | wsj.com | Steve Garmhausen

The Federal Reserve elected on Wednesday to keep interest rates steady, and that’s good news for savers: It means they’ll continue to in more than two decades. There’s more good news: The market, which just a few weeks ago expected rate cuts to start early in 2024, now until midyear. That expands the window in which savers can beat inflation—currently at 3.7%—by parking their cash in safe vehicles. Right now, —bonds with maturities of a year or less—are yielding as much as 5.5%.

1 month ago | wsj.com | Steve Garmhausen

Banks and credit unions have started slowly lowering the interest rates they pay savers amid expectations that the will eventually cut a key benchmark rate. But with the central bank expected to move slowly, the most generous institutions could keep their yields high into next year. For the past year, Americans willing to do a little shopping have been able to find and yielding more than 5% thanks to Fed policy. Those opportunities still exist.

1 month ago | wsj.com | Steve Garmhausen

The Federal Reserve’s decision to Wednesday means your savings accounts  will continue to enjoy decades-high yields of 5% or more. The question now is how long those juicy returns will last. Most market watchers expect the central bank to keep rates about where they are through mid-2024, and the and to follow suit.

1 month ago | wsj.com | Steve Garmhausen

Savers who’ve been enjoying the highest yields in years on bank savings accounts and CDs had been bracing for lower rates. Now they seem likely to get a reprieve. The yields that banks pay are heavily influenced by the Federal Reserve’s interest-rate decisions. So when the Fed raised rates sharply in 2022 and 2023 to fight inflation, savers reaped the benefit. More recently, inflation has been in retreat. As recently as a few weeks ago, Wall Street expected a round of rate cuts this spring.

1 month ago | wsj.com | Steve Garmhausen

Interest rates are still rising, and that’s good news for savers. But today’s rates may not be around for long. So, if you don’t need immediate access to your savings, it may make sense to with a CD. short-term interest rates by 0.25% on Wednesday, the latest in a series of hikes that has rewarded savers with the highest yields in many years. At the same time, the central bank going forward. Many on Wall Street believe the Fed may even begin to dial back short-term rates later this year.