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Key Takeaways
- Today’s highly-anticipated jobs report showed that the job market in April was resilient. More jobs were added than economists expected.
- It’s a welcome development, given that President Trump could have caused a job slowdown by his April tariffs, which, in turn, could have presaged a recession.
- The Fed will now be expected to remain neutral in its interest rate policy until July.
- This is good news for those who want to save, as the Fed’s continued rate pause could mean that the top rates on savings, money markets, and CDs will also remain.
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The Latest Job Numbers Could Impact Savings APYs
As with many metrics on the U.S. Financial Markets, one factor influences another which impacts another and so on. The monthly jobs report today is one of the data inputs which can have a large impact on many factors within our economy.
It may seem that way when you consider any links between what banks and credit-unions are willing pay for your cash deposit. While there’s no direct link between the two, the Federal Reserve uses the monthly jobs reports as one of its key factors when deciding if it wants to raise, lower or maintain the federal fund rate.
The fed funds rate is also important for savers, because it affects the rates that banks, credit unions, and money market accounts pay. A rising Fed Rate will increase bank APYs, while a central bank cut will cause the banks to lower rates.
How Today's Jobs Report Could Influence the Fed
The April jobs report, released this morning, was better than expected. There was concern that the economic chaos surrounding President Trump’s tariff campaign last month could cause a jobs slowdown—and that would have increased the chances of a coming recession. In this situation, the Fed would have been under increasing pressure to reduce its benchmark rate sooner than later.
But instead, the somewhat rosy jobs data means the labor market is showing resiliency and doesn't need to be rescued by the Fed—at least not for now.
The CME Group’s FedWatch Tool shows that the financial markets are now pricing in higher odds than yesterday about when the Fed is likely to make its first interest rate cut of 2025. Prior to this, the odds were about 2:1 that the Fed would announce a rate cut on June 18, according to the CME Group’s FedWatch Tool.
This probability has now dropped to around 35%. Traders are not pricing a quarter point rate cut in until the July meeting.
What this means for your savings in the bank
If those Fed rate forecasts come to fruition, the stellar rates you can enjoy right now on a high-yield savings account—up to 5.00% APY—could stick around for 2–3 months. Money market accounts currently pay up to 4.40%.
The best CD rates in the country could continue to be on their current course for some time. It’s important to remember that CD rates tend fall faster than savings account rates when a Fed rate reduction is on the horizon. That’s because CDs, by design, include a rate promise for months or years into the future. If the Fed’s next meeting is announcing a rate cut, banks and credit cards will begin to lower their CDs rates in advance of the Fed’s announcement.
It’s a good time to lock in your CD. There’s no guarantee that you’ll be able to lock in today’s rate. And a good offer can disappear over night. Since there is little chance that rates will increase in the next few months, future CD rates are almost entirely at risk of falling. So if you have a portion of savings you can commit for a few months, a year, or even longer, today’s rates—up to 4.50% right now—are smart to nail down.
Daily Rankings of Best CDs and Savings accounts
These rankings are updated every business day so that you can get the best possible deposit rates.
- Best 3-Month Rates
- Best 6-Month CD rates
- Best 1-Year CD rates
- Best CD Rates for 18-Months
- Best 2-Year Rates on CD
- Best 3-Year CD rates
- Best 4-year CD Rates
- Best 5-Year CD rates
- Best High-Yielding Savings Accounts
- Best Money Market Accounts
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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 different from the national average that includes all banks that offer a CD under that term. Many large banks pay a pittance of interest. The national averages are usually quite low. However, you can find rates that are 5, 10, or 15 times higher by shopping around.
How to Find the Best CD Rates and Savings
Investopedia tracks daily the rates of more than 200 banks, credit unions, and savings accounts that are offered to customers across the nation. This data is used to determine the best-paying accounts. For an institution to qualify for our lists it must be federally-insured (FDIC or NCUA for banks and credit unions) and the account must have a minimum initial deposit of no more than $25,000. The maximum deposit amount cannot be less than $5,000.
To qualify as a national bank, the bank must be located in at least forty states. While some credit unions ask you to donate money to a charity or organization to become a membership if you don’t meet the other eligibility criteria, (e.g. if you live in a specific area or have a certain type of job), we exclude those credit unions that require a minimum donation of $40. To learn more about our methodology, please read the full article.
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CME Group. "CME FedWatch Tool."
