I noticed ING Direct quietly lowered their interest rate on savings accounts once again. About a month ago, I speculated that this would happen, because their rate was higher than the Fed’s discount rate. At 3.1% APY, they are just slightly above the Fed’s rate, so I imagine they will stay at this level for some time to come.
Its easier to deal with them slowly lowering your rate as a customer than getting hit by a big cut all at once. I believe they are slowly lowering their rates, so that the shock doesn’t motivate people to yank all the money out of their accounts.
My prediction is that the Fed will leave rates alone for a while and that the next move will actually be to raise them in order to fight off inflation and the weakening US Dollar.