Still, high inflation has not yet been vanquished. Horn, certified financial planner (CFP) at Investment Initiatives in Alexandria, Va. “The pundits believe the Federal Reserve is nearing the end of their hiking cycle,” said Mark R.
The Fed has correspondingly responded by signaling that it may be done with its efforts. That caused price growth to moderate, albeit begrudgingly, falling from a 40-year high of roughly 9% in June 2022 to about 3% a year later. Why CD rates rose in 2023Įver since the beginning of 2022, the Federal Reserve has taken a firm stance of keeping rates high to tame inflation, increasing short-term borrowing costs repeatedly since the end of the pandemic to levels not seen since before the Great Recession. The good news is that, with a little planning, you can use a variety of CD terms in order to meet your savings goals, while also staying ahead of a changing rate environment. While you want to lock in the best possible yield when you open a certificate of deposit, that desire comes with a nagging doubt: What if rates go up tomorrow? Given that CD rates morphed from infinitesimal to boisterous as the Fed hiked borrowing rates over the past 18 months, any anxiety is justified.
