Treasury Department announces new Series I bond rate of 4.28% for the next six months

Series I bonds will pay 4.28% annual interest from May 1 through October 2024, the U.S. Department of the Treasury announced Tuesday.

Linked to inflation, the latest I bond rate is down from the 5.27% annual rate offered since November and slightly lower than the 4.3% from May 2023.

Current I bond owners will also see their rates adjust, depending on when they bought the assets. There's a six-month timeline for rate changes, which begins on the original purchase date.

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Despite falling rates, the I bond's fixed-rate portion is still "very attractive" for long-term investors, said Ken Tumin, founder of DepositAccounts.com, which closely tracks these assets.

There are two parts to I bond rates — a variable- and fixed-rate portion — which the Treasury adjusts every May and November. The history of both rates is here. 

Based on inflation, the variable rate stays the same for six months after purchase, regardless of when the Treasury announces new rates. 

After the first six months, the variable yield changes to the next announced rate. For example, if you bought I bonds in September of any given year, your rates change each year on March 1 and Sept. 1, according to the Treasury. 

By comparison, the fixed rate, which is harder to predict, stays the same after purchase. Every May and November, the Treasury can adjust or keep the fixed rate the same.  

Millions of investors piled into I bonds after the annual rate hit a record 9.62% in May 2022, and rates have since fallen amid cooling inflation. 

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