Banks continue offering 4.20% APY on 2-year certificates of deposit despite broader declines in deposit account rates.
The highest-yielding certificates of deposit remain at 4.20% APY for 2-year terms, offered by United Fidelity Bank and Sallie Mae. This comes as broader deposit account rates trend downward, preserving a competitive option for savers seeking fixed returns.
Short-term CDs, particularly those with six- to 12-month maturities, currently average around 4% APY, significantly outpacing traditional savings accounts. Rates have declined from peaks earlier in the decade but remain elevated compared to the post-2008 lows, when 6-month CDs fell to 0.1% APY.
The Federal Reserve’s prolonged near-zero benchmark rate following the 2008 financial crisis drove CD yields to historic lows, with 1-year CDs averaging 1% APY by 2009 and 5-year CDs below 2% APY.