bg-arrow-down icon-arrow-up icon-back-to-top icon-linkedin icon-menu icon-search icon-twitter logo-white slider-arrow-left-gray slider-arrow-left slider-arrow-right-gray slider-arrow-right

Forecast: Savings yields are expected to stay relatively steady in 2021

What will drive rates in 2021

With the Fed not expecting to raise rates for several years, savers will likely need to wait until banks actually need deposits again before yields on savings and money market accounts increase.

“Banks want deposits if they can lend against them,” says Adam Stockton, director of consumer pricing at Novantas. “That’s ultimately how they make money.”

More lending may create a demand for deposits again, at some point.

“Loan growth has not been zero this year, but it has been kind of far slower than the amount of deposits that have come into the system through the government stimulus,” Stockton says. “And so… there aren’t enough opportunities [for banks] to lend the deposits that have come in.”

Stockton projects the top-yielding savings accounts and money market accounts will look much the same in December 2021 as they do now. As he sees it, it will probably take until late 2021, or more likely 2022 for upward movement in rates.


For more information, contact Novantas Marketing

+1 (212) 953-4444

Related Materials


This Month In Commercial Banking | April 2021

We begin this month with a Novantas analysis that explores the future for the commercial deposit surge.


Novantas Review | Spring 2021

This edition of the Novantas Review explores the myriad opportunities that banks can embrace as they plan for a new post-COVID-19 era.


Funding Optimization is Crucial as Surge Deposits Linger

The flood of deposits into the banking system highlights the need for funding optimization that uses scoring to value and manage deposit customers on a granular basis.