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CD rates fall to 1.68%, boosting appeal of income-focused ETFs
The national 12-month CD average fell to 1.68% after the Fed cut its target range to 3.75%, while the 10-year Treasury is yielding 4.63%.
CD rates have dropped sharply, with the national 12-month CD average at 1.68%, down from a 2025 peak of 1.76%, according to an article on Yahoo Finance. The piece links the shift to recent Federal Reserve policy, saying the central bank cut its target range down to 3.75% and held it there since December 10, 2025.
Yahoo Finance argues that cash investors comparing bank products to market-based income streams may find ETFs more attractive as CD ladders lose some appeal. It points to three exchange traded funds, including the JPMorgan Equity Premium Income ETF, which combines large-cap U.S. stocks with a covered call overlay, and says distributions arrive monthly.
The article says JEPI has paid $4.58022 per share over the trailing year based on a current price of $57.51, with a 0.35% expense ratio. It also notes JEPI’s tradeoff, that the covered call overlay can cap gains during sharp equity rallies.
For structured credit income, Yahoo Finance highlights the Janus Henderson AAA CLO ETF, JAAA, describing it as holding AAA-rated collateralized loan obligation tranches with floating-rate coupons and citing an expense rate of 0.20%. The piece also mentions the Vanguard High Dividend Yield ETF, VYM, as another option for investors seeking ongoing income after the Fed’s shift.
The article further ties the relative attractiveness of these products to market pricing, noting that the 10-year Treasury yield is 4.63% and that banks typically price CDs off the Fed funds rate after the Fed cut and then paused.