Top CD Rates Today: 10 Options Remain To Earn 5.50% or Better (2024)

Where Are CD Rates Headed This Year?

The Federal Reserve announced at its Jan. 31 meeting that it is maintaining rates at their current level, the fourth meeting in a row it's done so. To combat decades-high inflation, the Fed had aggressively hiked interest rates between March 2022 and July 2023, raising the federal funds rate to its highest level in 22 years.

This in turn created historically favorable conditions for CD shoppers, as well as for anyone holding cash in ahigh-yield savingsormoney market account. Rates on CDs continued rising to a peak this fall, reaching their highest levels in two decades.

But inflation has been cooling, putting the Fed in a holding pattern since July. The central bank also signaled after its January meeting that it was most likely finished with its rate-hike campaign. This means we've entered a new phase, where the Fed committee is focused on deciding the right timing to pull the trigger on a first rate cut.

Financial markets are currently forecasting more than one rate cut in 2024, according to the CME Group's FedWatch Tool, with a majority of traders believing the first cut will arrive by June. But what markets predict and what the Fed ultimately does may or may not align.

Indeed, Fed Chair Jerome Powell testified to Congress today and indicated the rate-setting committee still thinks it's likely they will implement rate cuts this year. But his remarks also conveyed caution that predictions at this time are merely best guesses.

"The economic outlook is uncertain, and ongoing progress toward our 2% objective for inflation is not assured," Powell said in his prepared comments. "Reducing policy restraint too soon or too much could result in a reversal of progress we have seen."

Economic data released since the Fed's meeting aren't helping the case for the case for prompt rate cuts. Last week, the Fed's preferred inflation metric showed an acceleration from the previous month. And a Fed board member speaking Friday conveyed his less certain outlook about making a rate cut in 2024. When asked if the Fed would still cut rates this year, he responded, "We'll see."

What this means for CD rates is that they're likely to drift slightly lower, or even plateau, until it appears the Fed is ready to make its first cut. If at some point that seems to be in the cards, banks and credit unions will likely begin lowering rates more substantially.

How We Find the Best CD Rates

Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs to customers nationwide and determines daily rankings of the top-paying certificates in every major term. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the CD's minimum initial deposit must not exceed $25,000.

Banks must be available in at least 40 states. And while some credit unions require you to donate to a specific charity or association to become a member if you don't meet other eligibility criteria (e.g., you don't live in a certain area or work in a certain kind of job), we exclude credit unions whose donation requirement is $40 or more. For more about how we choose the best rates, read our full methodology.