March 2025 CD Rates Show Gradual Decline as APYs Settle in 4% Range
CD Rates Overview 2025: Current Trends and Analysis
Short-term CD rates now range from 4.00% to 4.50%, down from 5% rates seen in early 2024. Longer-term CDs (3-5 years) remain steady in the mid-3% range. Recent rate changes have been more gradual compared to the steeper drops in late 2024.
Current CD Rate Trends (January 2025):
6-month CD: 4.00% APY 1-year CD: 4.00% APY 3-year CD: 3.50% APY 5-year CD: 3.50% APY
Key Highlights:
- Short-term CDs continue offering higher rates than longer-term options
- Online banks and credit unions maintain the most competitive rates
- Rate decreases have slowed to around 0.10 percentage points per month
- National average rates remain significantly lower than high-yield options
Notable Promotional CD Rates:
- 7-month: Up to 4.50% APY
- 9-month: Up to 4.50% APY
- 13-14 month: Up to 4.50% APY
- 15-17 month: Around 4.15% APY
Market Analysis:
The gradual decline in CD rates follows multiple Federal Reserve rate cuts in late 2024. While rates are dropping, the decrease has been more measured in early 2025. High-yield CDs still offer rates several times higher than national averages, making them attractive for savers looking to lock in returns.
Best Practices:
- Consider shorter-term CDs for higher rates
- Compare promotional rates for unique term lengths
- Lock in rates while they remain elevated
- Watch for continued gradual rate decreases throughout 2025
CD rates remain an effective savings tool despite recent decreases, especially when compared to traditional savings accounts. Online banks and credit unions continue offering the most competitive rates in the market.