Treasury Yields Push Higher Again as Bank Deposit Pricing Lags

Executive summary. Market rates moved higher again Thursday: the 2-year Treasury closed at 4.87%, the 5-year at 5.03%, and the 10-year at 5.18%, all above Wednesday’s levels. The latest official SOFR reading is 3.88%, effective fed funds is 3.88%, and bank prime remains 7.00%. Mortgage rates also moved higher, with Freddie Mac’s September 24 survey putting the average 30-year fixed mortgage at 7.03%, up from 6.95% a week earlier.

Data note: today's collection added 35 Bank Verified observations and two newly verified institutions, GO2bank / Green Dot Bank and Morgan Stanley Private Bank (E*TRADE). None of today's observations produced a verified increase or cut against an exact prior comparable.

Rate Environment

The broader rate environment is mixed but increasingly unfavorable for borrowers. Treasury yields and mortgage rates are rising, while the latest measurable OnlineBankRates deposit panel showed bank APYs largely holding steady rather than following market yields higher. The September 24 exact-comparable panel recorded 0 increases, 70 unchanged products and 0 cuts; September 25 added no new exact-comparable repricings.

Today's Numbers

Rate / Metric	Latest
Effective Fed Funds	3.88%
SOFR	3.88%
Prime	7.00%
2-Year Treasury	4.87%
5-Year Treasury	5.03%
10-Year Treasury	5.18%
30-Year Fixed Mortgage	7.03%
Latest OBR Savings Index	3.79% APY
Latest OBR 12-Month CD Index	3.94% APY
Best captured liquid savings	4.21% APY qualifying
Best captured savings without stated relationship requirement	4.20% APY
Best captured money market	4.05% APY
Best captured CD	4.40% APY

The New York Fed reports SOFR at 3.88% for September 24 and effective fed funds at 3.88% for the latest published observation. Treasury's September 24 curve shows 4.51% at one year, 4.87% at two years, 5.03% at five years and 5.18% at ten years. Freddie Mac's September 24 PMMS puts the 30-year fixed mortgage at 7.03% and the 15-year at 6.42%.

Biggest Moves

No September 25 bank-level increase or cut qualified for publication: the Verified Changes list for today is empty.

The latest verified OBR comparison remains September 24: 0 increases, 70 unchanged and 0 cuts across 70 exact-comparable deposit products. The most recent verified repricing in the accessible history was CFG Bank's High Yield Money Market Online increase from 3.80% to 4.05% APY, a 25-basis-point increase.

A complete seven-day ranking is still premature because the exact-comparable historical series only began September 21.

Latest measured Bank Rate Breadth: 0% up / 100% unchanged / 0% down (n=70).

Where Savers Are Winning

The latest Bank Verified OBR dataset shows the strongest captured liquid savings yield at 4.21% APY from Axos ONE Savings, subject to qualifying activity. Newly verified today: Morgan Stanley Private Bank (E*TRADE) Premium Savings at a 4.25% promotional APY (3.75% base), and GO2bank's High-Yield Savings Vaults at 4.50% APY with qualifying requirements. Newtek Bank's 4.20% APY remains the strongest non-promotional savings rate without a stated relationship requirement.

For money markets, CFG Bank leads at 4.05% APY, with Bank5 Connect at 4.00%.

The highest captured CD yield remains 4.40% APY at Sallie Mae Bank, available in the latest dataset at 15-, 36- and 60-month terms. Marcus reaches 4.35% across several intermediate and longer maturities, while CFG reaches 4.30% at 12, 18, 36 and 60 months.

Borrower Watch

Borrowers received another unfavorable signal this week.

Freddie Mac's average 30-year mortgage increased from 6.95% to 7.03%, an 8-basis-point weekly increase. The 15-year rate rose even more, from 6.26% to 6.42%.

Meanwhile, the 10-year Treasury rose from 5.11% Wednesday to 5.18% Thursday.

That puts the current 30-year mortgage/10-year Treasury spread at approximately:

7.03% − 5.18% = 1.85 percentage points, or 185 basis points.

Prime remains 7.00%, versus 6.75% before the September Fed increase.

Yield Curve / CD Strategy

The widening gap between Treasury yields and bank deposit products is becoming one of the most important signals OnlineBankRates is tracking.

The September 24 Treasury curve pays approximately:

1 year: 4.51% 2 years: 4.87% 5 years: 5.03% 10 years: 5.18%

Against the latest captured OBR leaders:

Liquid savings: 4.21% 12-month CD: 4.30% 24-month CD: 4.35% 60-month CD: 4.40%

That means the Treasury advantage is approximately 21 bp at one year, 52 bp at two years and 63 bp at five years versus the strongest comparable bank CDs currently captured.

The comparison isn't purely about headline yield: liquidity, early-withdrawal penalties, deposit insurance, Treasury tax treatment and maturity all matter. But today's curve provides little evidence that locking money into a longer bank CD is being rewarded with a higher nominal yield than Treasuries.

Bank Behavior

The most recent complete OBR comparison continues to show very slow deposit-rate pass-through following the September Fed increase.

Across 70 exact-comparable products on September 24, not one repriced higher or lower. The 24-institution panel is still weighted toward online-oriented institutions and contains only two credit unions, while large traditional banks are not yet represented broadly enough to calculate a defensible Online-vs-National Bank Premium.

Accordingly:

Online-bank movement: no broad repricing signal yet. Credit-union movement: sample too small for a defensible trend. Large traditional banks: insufficient coverage for comparison.

Expansion of these cohorts remains important before OBR publishes category-level conclusions.

OnlineBankRates Takeaway

Treasury yields are moving faster than bank deposit rates. The 10-year Treasury reached 5.18% Thursday, the 5-year crossed 5.00%, and Freddie Mac's 30-year mortgage average climbed back above 7%. Yet the latest complete OnlineBankRates comparison found no repricing across 70 directly comparable deposit products. That creates an increasingly noticeable gap for savers: leading liquid savings accounts remain around 4.20%, while Treasury yields now range from 4.51% at one year to 5.18% at ten years. Borrowers are seeing the opposite effect, with mortgage and market yields moving higher while prime remains at 7.00%. The key question now is whether banks begin competing harder for deposits—or continue allowing the spread between deposit APYs and market yields to widen.

OnlineBankRates Proprietary Metrics

Metric	Latest publishable reading	Status
OBR Savings Index	3.79%	Latest complete panel
OBR 12-Month CD Index	3.94%	Latest complete panel
Best Cash Yield	4.21%	Qualifying APY
Bank Rate Breadth	0 / 100 / 0	Latest complete panel, n=70
Fed Pass-Through Score	1.3% provisional	Latest complete panel
Online-vs-National Premium	Pending	Insufficient large-bank sample

Today's Treasury/CD spreads are calculations from official Treasury yields and the latest Bank Verified OBR observations. Indexes above reflect the latest complete panel.

Data Coverage

The latest first-party OBR dataset contains 26 Bank Verified institutions and 242 historical Bank Verified observations, with zero Third Party Verified production observations. The September 24 run began with 23 institutions, added Forbright Bank, and appended 76 observations.

September 25 collection: started with 24 Bank Verified institutions, added GO2bank / Green Dot Bank and Morgan Stanley Private Bank (E*TRADE), and ended with 26. It appended 35 observations, bringing history to 242 Bank Verified observations. No verified rate changes were recorded.

Data & Methodology

OnlineBankRates institution-level production rates come from financial institutions' own public sources. Third-party comparison sites are not treated as production rate sources.

The OBR Savings Index is the simple average of each institution's highest captured savings APY, with each institution contributing once. The OBR 12-Month CD Index similarly uses each institution's highest captured 12-month CD/certificate APY. Bank Rate Breadth measures the percentage of exact-comparable Bank Verified observations that increased, remained unchanged or decreased. Best Cash Yield is the highest currently captured liquid savings APY, with qualification requirements disclosed. Fed Pass-Through Score measures cumulative observed deposit repricing relative to the change in effective fed funds.

Official benchmark sources: New York Fed reference rates, U.S. Treasury daily yield curve, Federal Reserve H.15 and Freddie Mac PMMS.