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Analysis of September CD Rates

In a recent analysis by CD Valet, a prominent digital marketplace that connects consumers with competitive CD rates across the United States, stark trends emerged regarding the future of CD (certificate of deposit) rates. The study highlights a significant acceleration in the decline of CD rates following actions taken by the Federal Reserve, with approximately 91% of changes reflecting decreases.

CD Valet's report, released on October 2, 2025, indicates that this trend is a direct result of the Federal Open Market Committee's (FOMC) decision to reduce interest rates by 0.25%. This decision has evidently influenced the yield curves for CDs, revealing an inverted structure that indicates lower rates for longer-term deposits compared to shorter ones.

Mary Grace Roske, who leads marketing and communications at CD Valet, elaborated on the situation: "While savers might have missed the high point in this interest rate cycle, there is still a window of opportunity. The best time to lock in a rate may have been yesterday, but the second-best time is today." This suggests that now could be a strategic moment for consumers to secure fixed-rate CDs, especially as predictions indicate that high-yield savings and money market accounts may see significant declines by year-end.

The data further reveals that only a small fraction, about 9%, of CD rate adjustments resulted in increases over the month, indicating an ongoing downward trajectory. Compared to prior months, this represents a stark shift from June, July, and August, where increases accounted for 42%, 36%, and 26% of changes, respectively.

During September, a staggering 5,662 CD APY (Annual Percentage Yield) decreases were reported, a fourfold increase compared to August. The average decline in rates was around 25 basis points, contrasting sharply with the 574 increases logged during the same period, which averaged about 45 basis points.

Roske pointed out how financial institutions are adjusting their strategies in this shifting market. Many banks and credit unions appear to be reducing promotional CD offers and focusing instead on standard terms in light of the declining rates. The trend signifies a movement away from short-term promos, with an expectation that fewer offers will be available for terms shorter than 12 months.

Looking ahead, the expectation is that the inverted yield curve might begin to level out as 2025 progresses into 2026. Analysts anticipate that the Fed's rate cuts will enable short-term yields to drop more quickly than long-term rates, allowing for a normalization in the market that reflects a healthier confidence in the inflation trajectory.

Additional insights from the analysis indicate that of the institutions increasing CD rates during the month, approximately 60% were credit unions, while banks accounted for the remaining 40%. Notably, the average APY for credit union CDs was found to be around 17% higher than that of banks, demonstrating their competitive edge in this current environment.

Roske emphasized the importance for savers to act thoughtfully amidst a changing financial landscape. The unprecedented volume of rate changes presents a perfect opportunity for consumers to assess their options and lock in better rates before further declines take effect. With the increasing complexities of the financial market, tools like CD Valet’s Best CD Rates by State Map can effectively assist consumers in navigating and optimizing their savings decisions.

In summary, CD Valet continues to be an essential resource, connecting consumers with the best available CD rates while enabling financial institutions to competitively garner deposits. As the market adjusts to the present realities caused by fiscal policy changes, both savers and banks will need to remain vigilant and informed to maximize their financial gains. For more information, visit CD Valet's official site.