Treasury Department announces new Series I bond rate of 4.26% for the next six months
by Kate Dore, CFP®, EA · CNBCKey Points
- Series I bonds will pay 4.26% through October 2026, the U.S. Department of the Treasury announced.
- The latest I bond rate is up from the 4.03% rate offered through April.
- Current I bond owners will see rates adjust based on their purchase date.
The U.S. Department of the Treasury has announced new rates for Series I bonds.
Newly purchased I bonds will pay 4.26% annual interest from May 1 through Oct. 31, which is up from the 4.03% yield offered through April 30.
The new rate includes a variable portion of 3.34%, based on inflation data, and a fixed portion of 0.90%. The combined rate is 4.26% after rounding, according to the Treasury. The fixed rate is the same from 0.90% announced in October.
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Amid soaring inflation, the I bond rate hit a record high of 9.62% in May 2022, and investors poured into the government-backed, nearly risk-free asset.
Many shorter-term investors have since redeemed I bonds as rates and inflation have fallen. But the higher fixed rate has remained attractive to some longer-term investors, experts say.
Earlier this year, I bond interest was "lukewarm," according to David Enna, founder of Tipswatch.com, a website that tracks Treasury inflation-protected securities, or TIPS, and I bond rates.
But some investors are watching I bonds again as inflation has ticked higher, he said.
The consumer price index, or CPI, a key inflation gauge, jumped 3.3% in March 2026 from one year earlier, up from 2.4% in February, the Bureau of Labor Statistics reported in April.
This marked the first CPI release since the start of the Iran war on Feb. 28, which has increased gasoline and other consumer prices.
High oil prices are expected to push up inflation by 0.6 of a percentage point this year, according to CNBC's latest Fed Survey.
How I bond rates work
I bonds have a variable and fixed rate portion, which the Treasury adjusts every six months, in May and November. Investors receive the combined "composite rate" for a six-month period.
The variable rate is tied to inflation, and stays the same for six months after your purchase date, regardless of the Treasury's next update.
By comparison, your fixed rate doesn't change after purchasing I bonds. The Treasury doesn't disclose how it calculates fixed-rate adjustments, making it harder to predict.
How the change affects current I bond investors
If you already own I bonds, there's a six-month timeline for rate updates, which shifts depending on your original purchase date.
After you own I bonds for six months, the variable yield changes to the next announced rate. But the fixed rate stays the same while you own the asset.
For example, let's say you purchased I bonds in September. Your variable rate would start at 2.86% and shift to 3.12% in March. Your fixed rate remains at 1.10%. At that point, your new composite rate would be 4.22%.
You can earn I bond interest for up to 30 years, or less if you redeem the assets before that. However, you can't cash in I bonds for at least one year after purchase. If you redeem within five years, you lose your last three months of interest.