Treasury Sets New I Bond Rate at 5.51%, With Fixed Rate at Highest Since 2006

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The U.S. Treasury on Friday set the new interest rate on Series I savings bonds at a composite 5.51% a year for bonds issued from November 1, 2026 through April 30, 2027, up from 4.26% for bonds issued over the previous six months, according to TreasuryDirect, the Treasury Department’s official savings bond site. The increase is led by the fixed rate, which the Treasury raised to 1.40% from 0.90%. That is the highest fixed rate since November 2006, and it stays with each new bond for its entire 30-year life.

The composite rate combines that fixed rate with an inflation rate that resets every six months. TreasuryDirect puts the semiannual inflation rate at 2.04%, based on changes in the Consumer Price Index for All Urban Consumers between April and September, which works out to a 4.08% annualized variable rate. Under the Treasury’s formula, the fixed rate plus twice the semiannual inflation rate plus the product of the two produces the 5.51% composite rate that new bonds earn for their first six months. After that first period, the inflation part of the rate resets every six months, in line with how inflation actually works through the consumer price index, while the 1.40% fixed part never changes.

For savers, the new terms apply to bonds bought during the November-to-April window, and I bonds are sold only electronically through TreasuryDirect. Purchases are capped at $10,000 per person in a calendar year, USA Today reported, and a bond cannot be cashed in during its first 12 months. Savers who redeem before five years give up the last three months of interest. Interest on the bonds is subject to federal income tax but is exempt from state and local taxes, and existing holders are not left out of the increase entirely: bonds already issued will pick up the new 4.08% inflation rate for six months on a schedule that depends on the month they were bought, while keeping the fixed rate that was set at their purchase.

The new composite rate is the highest since November 2022, Barron’s and Money reported, although it remains well below the 9.62% the bonds carried in 2022, when inflation ran at a 40-year high. The Treasury sets the I bond rates every May 1 and November 1, and the next reset is due on May 1, 2027, when both the fixed rate for new bonds and the inflation rate for all bonds will be set again from the inflation data accumulated by then. Readers can follow further household-facing rate and tax developments on the Tax & Policy desk.

Educational coverage — not tax or investment advice.