Core Insights - The Federal Reserve has implemented a quarter-point rate cut, marking its third reduction of 2025, totaling 0.75 percentage points for the year, following a 1.00 point cut in late 2024 [2][10] Impact on Savings - The Fed's rate cuts directly influence deposit rates at banks and credit unions, leading to expected lower yields on savings accounts and CDs in the coming weeks, although the decline is anticipated to be modest [3][10] - Current high-yield savings accounts offer competitive returns between 4.15% and 5.00% APY, while the best nationwide CDs reach up to 4.50%, with longer terms providing multi-year returns of 4% or more [12] 2026 Rate Outlook - The Fed's 2026 projections reveal a divided outlook among policymakers, with the median expectation indicating a single quarter-point rate cut, but forecasts range from a 0.25-point hike to cuts of 1.50 points [6][7] - Economic signals are conflicting, with rising unemployment and reaccelerating inflation complicating the Fed's decision-making process, as highlighted by Fed Chair Jerome Powell [8][10] Uncertainty in Rate Policy - The wide distribution of forecasts among Fed officials underscores the uncertainty surrounding future rate movements, making it difficult to predict the trajectory of deposit yields [9][10] - The dot plot serves as guidance rather than a fixed path, indicating that the Fed's internal consensus is not aligned, adding to the unpredictability of future rate changes [9]