Investors and members looking for the best rates on certificates of deposit are typically steered to credit unions for the sweetest deals. But the competition is getting stiffer for the cooperatives."Clearly, banks and credit unions are getting more aggressive with returns on short-term deposit products in order to build deposits," said Dan Geller, executive vice president of Market Rates Insight, a San Anselmo, Calif., firm that tracks rates loans, fees and rates. "The findings of our most recent analysis show the market for deposits is focused on the highest return for the shortest term."According to MRI, the premium paid on short-term CDs increased from 66.3% in January to 100.4% in September, an increase of 34.1 percentage points. Short-term CDs are defined those with a one-year or less term. At the same time, the premium paid on long-term CDs decreased from 48.4% in January to 46.3% in September, which only amounted to a decrease of 2.1 points.Geller said the shift to short-term investments is one of the signs of an uncertain economy. As a result, consumers want to be able to access their money quickly in case of emergencies."It's a mixture of uncertainty and the job market," Geller explained. "The bottom line is people prefer to make short-term commitments in case they need the funds."In its recent sample of 1,300 banks and credit unions, MRI looked at several CD rates. The premium rate is the additional interest rate offered on special deposits compared to the regular interest normally offered, Geller said. The premium is the percentage difference between the regular and special interest rates.Even though some banks are catching up to credit unions with their CD offerings, notable leads can still be found. According to bankrate.com, as of Oct. 15, the nation's highest yielding one-year and six-month CDs was offered by Wings Financial Federal Credit Union at 2.75% and 2.35%, respectively. The rates were well above the same highest yielding products at banks. Ally Bank topped the list with a 2.03% rate on its one-year CD and a 1.64% rate on its six-month CD.Looking ahead, Geller said as long as the economy and the job market outlook remains unstable, members and customers may continue to seek short-term relief."Institutions typically respond to market demand," Geller said. "If they see the demand for more of a product, they will certainly satisfy that demand."–[email protected]