Certificate of deposit rates took a big step backwards last week, falling up to 35 basis points in key categories.
A visit to the BankingMyWay CD Rate tracker reveals the carnage, with the 48-month CD falling from 1.495% to 1.461%, while the 24-month CD dropped from 0.963% to 0.934%.
It wasn’t like the other CD categories did much better, either. In general, all were off significantly, and bank investors can only wonder what they ever did to deserve a CD market like this.
We can engage in all the finger-pointing we want, but at some point bank rate markets are released from their moorings and drift in any direction that market forces push them. Sure, the financial markets got a sniff of Friday’s unemployment numbers, with news that the jobless rate was inching up again. But the big picture remains the same: While the economy is officially out of recession, it sure looks like an economy that’s still in recession.
Here are some key points to keep in mind:
- The stock market enjoyed a great September, but analysts point out that companies only beat earnings expectations that had already been set painfully low.
- The Labor Department will soon release September’s unemployment number, and it’s expected to rise from 9.6% to 9.7%.
- Consumer bankruptcies have risen 11% through the first nine months of 2010, according to the National Bankruptcy Research Center.
- Japan’s central bank cut its interest rate to near zero – a signal that the global economy remains in peril.