Savings Bond investments stagger up
Friday, January 5th, 2007
Categorized as: Savings Bond investment rate
After reaching a long-term low point in September (an annual rate of $2.56 billion compared to $8.334 billion for the Oct-Sep 2006 fiscal year), new investments in Series EE and I Savings Bonds are sort of lifting their head out of the gutter and looking around.
In October, before the last rate announcement, new investments rose to an annual rate of $2.86 billion. In November, after the EE bond rate dropped from 3.70% to 3.60% and the composite I bond rate rose from 2.01% to 4.52%, new investments rose again, but only to an annual rate of $3.89 billion, well below the historical rate of new Savings Bond investments.
As mentioned here in earlier posts, new investments in EE bonds have been suffering since the Treasury changed how it sets EE bond rates in May 2005. Even so, EE bonds outsold I bonds during the five months from June to October. And in November I bond investments were barely ahead at just 50.3% of the total.
Readers of my book have access to an online graph showing the level of Savings Bond investments since Series I bonds were introduced in 1998. Check your Book Notes for the link.