The national average rate for the five-year certificate of deposit has dropped below 1% for the first time, according to Market Rates Insight.
The average rate is 0.99%, the San Anselmo, Calif., firm said Monday its latest analysis showed.
"The five-year CD, which has always been the hallmark of high returns and stable annuities, has never dipped below 1% for as long as interest rate records are available," the firm said.
"Interest rates are making history, but clearly not in a favorable way," said Dan Geller, executive vice president at Market Rates Insight.
The rate had been more than 20% in June 1981 and has been as high as 6.25% in August 2000, Market Rates Insight.
"Unfortunately, the continuing decline in interest on deposits indicates that banks are forced to reduce their interest expense due to the soft lending market. As long as lending remains soft, and loan rates low, we will not see a change of course in deposit rates," Geller said.
He said the average four-year CD also reached a record low of 0.78%t this week, and the three-year CD rate now stands at 0.63%.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
