FNC’s Deirdre Bolton: Silver Lining to Rising Interest Rates Is Higher Rates on CDs

EXCERPT: 

BOLTON: "Looking for silver linings here. So here's one. Savers benefit. That’s the one thing we can talk about. Consumers should be able to get higher savings rates in their saving accounts with banks that they normally use. If those rates are not competitive, there’s now online banking options and some online only banks have pretty generous terms. CDs, certificates of deposits, they will offer higher rates. And that's a pretty safe place to put money. Lot of investors think CDs are the next best thing to cash. And for people close to retirement or in retirement, it’s a pretty popular product. When rates move higher, consumers can get better, higher that is, annual percentage yield. So I looked online and found yields on five-year CDs exceding 3 percent with a minimum deposit. In general, rising interest rates, also a sign that the economy is doing well. in theory, that indicates that more people can get pay increases at some point. That’s more of a fluid reason than the saving rates or the rates on CDs. For shareholders, Neil, lastly who own bank stocks, they may see a long-term boost in value because usually banks do pretty well in a higher rate environment. We know tomorrow we’re going to be hearing from four key banks. J.P. Morgan Chase, Wells Fargo, Citi Group, PNC Financial. Analysts will watch for details about loan growth. That’s one of the key metrics."