"Inflation-proof" I-bonds get new interest rate of 6.9% for the next 6 months
The Treasury has set a new interest rate for I-bonds, the normally staid investment vehicle that's seeing a surge of popularity amid decades-high inflation.
I-bonds issued over the next six months will yield an initial annualized return of 6.89%, the Treasury said Tuesday.
The rate on I-bonds, or inflation bonds, changes every six months based on inflation. In the most recent six-month period that ended in November, the bond rate was 9.62% — rivaling stock market returns and leading to a rush of consumers hurrying to buy before the rate reset on November 1. The surge in investor demand crashed the Treasury's website last week.
A Treasury spokesperson said the government sold as many bonds in a single day as it sold in the entire period between 2018 to 2020 — roughly $1 billion.
While the current rate of 6.89% is below recent highs, financial pros say it's still a solid investment for people who have some cash they would otherwise put in a savings account or CD.
"That's still above average rates out there," Alex Rezzo, founder of Andante Financial, told CBS MoneyWatch recently. "You could buy a 30-year investment-grade bond, and that's offering only 5%."