Fed Rate Cuts Once Again Affects Savings Accounts

Everyone knows that Bernanke has instated an emergency rate cut to resist an impending recession. Dropping the 4.25 percent interest rate by 75 basis points down to 3.5 percent would also lead to the reduced interest rates at the numerous banks with high-yield savings accounts. So far, ING Direct has already dropped their rates from 4.10% APY to 3.65% APY.

I’m with HSBC Direct which still has its 4.25% APY but this rate would most definitely not remain. Again, I’m frustrated at the continuous rate cuts that has followed the U.S. markets ever since I finally got the initiation to open a high-yield savings account.

By next week, I expect HSBC Direct to have a rate around 3.80% APY since their reductions seem follow the same amount that ING implements. A rate above my prediction would make me really happy…..