What causes savings accounts interest rates to go up or down over time?
The last person’s answer is mostly incorrect I think. Savings accounts interest rates are not the same as Fed Interest rates. The difference is the Fed controls the key rates that BANKS are CHARGED when they borrow money, you’re asking what effects the interest rates that banks PAY to consumers! Savings accounts for general consumers are set mostly on terms of competitiveness with other banks. Banks move this value to either keep up with inflation, or to stay competitive and have more consumers banking with them. Because savings interest rates are the rates that banks PAY to you, they have every right to move it however they want to stay competitive. Keep in mind that banks make the least amount of money from savings accounts and consumer banking in general. Most of their money comes from lending to businesses and whatnot. Savings accounts interest rates have little or nothing to do with Fed actions. Cheers!
