Fed Hike Has Repriced Borrowing Faster Than Bank Deposits

Executive summary. U.S. rate benchmarks remain firmly higher after the Federal Reserve's September 16 decision to raise its target range by 25 basis points to 3.75%–4.00%. Effective fed funds is 3.88%, prime is 7.00%, and the latest published Treasury curve remains elevated at 4.76% for 2 years, 4.83% for 5 years and 4.96% for 10 years. Deposit-rate direction remains undetermined: we do not yet have enough consecutive exact-comparable observations to claim that banks broadly raised or cut APYs.

Rate environment

Borrowing benchmarks are higher; deposit-rate breadth is not yet measurable. Effective fed funds rose 25 basis points from 3.63% to 3.88% after the hike, and prime moved from 6.75% to 7.00%. We will not characterize deposits as broadly rising until exact-product comparisons demonstrate that behavior.

Today's numbers

Rate / metric	Latest
Effective Fed Funds	3.88%
SOFR	~3.85%*
Prime	7.00%
2-Year Treasury	4.76%
5-Year Treasury	4.83%
10-Year Treasury	4.96%
30-Year Fixed Mortgage	6.95%
OBR Savings Index	3.73% APY
OBR 12-Month CD Index	3.95% APY
Best OBR Liquid Savings	4.20% APY
Best OBR Money Market	4.05% APY
Best OBR CD Observed	4.50% APY

*SOFR reflects the latest verified observation available for this brief.

Biggest moves

No bank-level increases or cuts qualify for publication today. Today's additions are all first observations of newly verified institutions, so none has an exact comparable prior Bank Verified reading to measure against. We require that comparison before labeling a product an increase or a cut.

• 1-day increases: none qualifying
• 1-day cuts: none qualifying
• Bank Rate Breadth: pending

Where savers are winning

Three new institutions entered the verified universe today and one of them now leads the CD table. Popular Direct is posting 4.50% APY at 36, 48 and 60 months and 4.25% at 12 months, above the prior 4.40% leader. Rising Bank came in at 4.05% for both 6- and 12-month terms, and First Internet Bank added a full savings, money market and CD lineup.

The strongest captured liquid savings APY is 4.20%, the strongest money market is 4.05%, and the strongest CD is now 4.50%. Treasuries still compete: the 2-year at 4.76% is 26 basis points above the CD leader, and the 5-year at 4.83% is 33 basis points higher.

Borrower watch

Borrowing benchmarks moved faster than deposit rates after the hike. Effective fed funds rose 25 basis points and prime rose the same amount to 7.00%. The latest 30-year mortgage benchmark of 6.95% is 19 basis points above the prior week's 6.76%. Against the 10-year Treasury at 4.96%, that is a spread of roughly 199 basis points.

Yield curve and CD strategy

Treasuries yield approximately 4.45% at one year, 4.76% at two years, 4.83% at five years and 4.96% at ten years. Our 12-month CD index sits near 3.95%, while the highest captured CD reaches 4.50%. The market does not uniformly reward accepting a bank CD lockup. Compare maturity, liquidity, early-withdrawal penalties, deposit insurance, tax treatment and yield together.

Takeaway

The Fed's September hike has already reached the parts of the system that reprice quickly: overnight funding and prime are 25 basis points higher, Treasury yields remain elevated, and the mortgage benchmark is back near 7%. Savers have not uniformly received the same benefit. The best deposit rates in our universe run about 4.00%–4.50%, while several Treasury maturities yield more. The next signal to watch is bank pass-through — how quickly and how completely institutions raise deposit APYs.

Data coverage

Coverage metric	Value
Starting verified institutions	20
Newly verified today	3 (Popular Direct, Rising Bank, First Internet Bank)
Ending verified institutions	23
New observations appended today	31
Bank Verified observation history	247
Third Party Verified	0
Verified rate changes today	None qualifying
Remaining discovery queue	5

Five institutions remain on hold in the discovery queue — Synchrony, OMB Bank, BTG Pactual, Forbright and Valley Direct — because a first-party numerical rate could not be captured. We publish nothing from them until it can.

Methodology

Institution-level rates and OBR indexes use independently collected, institution-owned public sources. The Savings Index averages each institution's highest broadly applicable captured savings APY so that multiple balance tiers cannot overweight one bank. The CD Index uses each institution's comparable 12-month certificate observation. Bank Rate Breadth reports the share of exact-comparable observations rising, unchanged and falling; it is never inferred from benchmark moves. Benchmark data come from the Federal Reserve, the New York Fed, the U.S. Treasury and Freddie Mac. Rates may change without notice, and eligibility, balance, geographic and relationship requirements may apply.