FILE - A sign highlighting the financing interest rate is displayed near the price sticker on an unsold 2023 vehicle at a Mercedes-Benz dealer on Nov. 30, 2023, in Loveland, Colo. The Federal Reserve’s decision Wednesday, May 1, 2024 to keep its benchmark rate at a two-decade high should have ripple effects across the economy. Mortgage rates, credit card rates, and auto loan rates will all likely maintain their highs, with consequences for consumer spending.
According to LendingTree, the average credit card interest rate in America today is 24.66%, unchanged from last month, though that rate has risen for 24 of the last 26 months. Certificate of deposit rates have been the first to fall, and a few online banks have also started lowering online savings account rates. Ally Bank dropped its rate to 4.25% from 4.35% and Discover to 4.25% from 4.30%.
The average savings account yield for all banks and credit unions, of which the vast majority are brick-and-mortar, is 0.52% as of April 24th.The Fed doesn’t directly set mortgage rates, but it does influence them. The bond market, inflation, and other factors all contribute to the high mortgage rates currently facing consumers.