Fed Rate Cut Looms in 5 Weeks—Yet Top CD Rates Just Spiked. Here’s How to Capitalize

The Fed’s dovish pivot is coming—but banks aren’t playing along. While markets price in a rate cut within weeks, the best CD rates just defied gravity and climbed higher. Here’s the playbook to lock in peak yields before the music stops.

Why CDs Are Defying the Fed

Banks smell blood in the water. With depositors flocking to higher-yielding alternatives (hello, crypto and Treasuries), some institutions are dangling juicier CD rates to stem the bleeding—even as the Fed prepares to ease. It’s a last-gasp cash grab dressed up as a ‘limited-time opportunity.’

How to Snag the Top Rate

Forget loyalty. The winning move? Aggressively shop credit unions and online banks, where 5%+ APYs still lurk. But act fast—these offers will vanish faster than a Wall Streeter’s conscience when fees are on the line.

The Cynical Take

Of course banks raised CD rates now. They’ll milk every basis point from savers before inevitably slashing payouts post-cut—all while charging borrowers prime-plus rates. Some things never change.

Key Takeaways

• The leading nationwide CD rate jumped today from 4.51% to 4.60%—available with a 7-month rate guarantee.
• This positive news for CD shoppers is surprising, considering the Fed is widely expected to cut interest rates next month.
• Want a longer rate lock? Ten other CDs pay 4.50% or better on terms up to 21 months. You can also secure a 4.28% rate for 3 to 5 years.
• The best CD rates can come and go quickly—so don't wait, or you might miss out on a great offer.
  

The full article continues below these offers from our partners.

Top CD Rate Hits 4.60%—Here’s Why That’s Big News Today

Since the start of August, the highest nationwide CD rate, regardless of term, has been 4.51%. But today, shoppers got some good news: A new offer has pushed the leading national rate to 4.60%. Available for a 7-month term from Connexus Credit Union, this CD locks in your rate until March 2026.

While an increase from 4.51% to 4.60% might seem small, it’s significant since CD rates are more likely to head downward right now. That's due to the anticipated interest rate cut from the Federal Reserve this fall. In fact, CD rates have been edging lower for months.

So why WOULD a bank or credit union raise its rate ahead of a likely Fed cut? The answer lies in the competitive CD landscape. For smaller institutions, offering a top-tier rate is a strategy to stand out in the crowd to attract deposits, especially when they don’t have the same brand recognition as big banks.

But beware: Whenever a bank or credit union raises its rate to leader status, no one knows how long the offer will last. If this CD generates a lot of interest, Connexus could pull it quickly. So consider this a hot opportunity—but one that may not be available for long.

An Upcoming Fed Rate Cut and What It Will Mean for CD Rates

The Federal Reserve meets eight times a year to decide whether to raise, lower, or maintain interest rates. So far this year, the Fed has kept the federal funds rate steady at five consecutive meetings, following three reductions in late 2024.

However, it now looks like the Fed is on track for its first rate cut of 2025. According to the CME FedWatch Tool, federal-funds futures indicate an 85% probability that the Fed will lower its benchmark rate by a quarter percentage point after its Sept. 16–17 meeting, with odds climbing to 94% by the October meeting.

This is important for savers because the Fed’s benchmark rate directly influences what banks and credit unions are willing to pay on savings, money market, and certificate of deposit (CD) accounts. With expectations high that the Fed will soon lower rates, CD rates will generally drift lower.

Fortunately, any CD rate you lock in now will stay with you for its entire term—whether that’s a short 6 months or a long 5 years. So by opening a CD now, while rates are high but expected to decline, you’re giving your future self the gift of higher returns.

How To Secure the New 4.60% CD—or Another Top Rate—Before It's Gone

Connexus' new nation-leading CD offers a 7-month term and can be opened online with a minimum deposit of $5,000. Though becoming a member of the credit union is required, eligibility is easy: Anyone can join by simply donating $5 to the Connexus Association and holding $5 or more in a member savings account.

Ten more CDs offer APYS of 4.50% or more, with terms stretching up to 21 months. That could guarantee your yield as far down the road as spring 2027. Or, you can secure a 4.28% return for 3, 4, or even 5 years with the leading long-term CDs.

Daily Rankings of the Best CDs and Savings Accounts

We update these rankings every business day to give you the best deposit rates available:

• Best 3-Month CD Rates
• Best 6-Month CD Rates
• Best 1-Year CD Rates
• Best 18-Month CD Rates
• Best 2-Year CD Rates
• Best 3-Year CD Rates
• Best 4-Year CD Rates
• Best 5-Year CD Rates
• Best High-Yield Savings Accounts
• Best Money Market Accounts

Important

Note that the "top rates" quoted here are the highest nationally available rates Investopedia has identified in its daily rate research on hundreds of banks and credit unions. This is much different than the national average, which includes all banks offering a CD with that term, including many large banks that pay a pittance in interest. Thus, the national averages are always quite low, while the top rates you can unearth by shopping around are often 5, 10, or even 15 times higher.

How We Find the Best Savings and CD Rates

Every business day, Investopedia tracks the rate data of more than 200 banks and credit unions that offer CDs and savings accounts to customers nationwide and determines daily rankings of the top-paying accounts. To qualify for our lists, the institution must be federally insured (FDIC for banks, NCUA for credit unions), and the account's minimum initial deposit must not exceed $25,000. It also cannot specify a maximum deposit amount that's below $5,000.

Banks must be available in at least 40 states to qualify as nationally available. 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.