Public Debt Announces New Savings Bonds Rates Series I to Earn 1.74%, Series EE to Earn 1.40%


May 3, 2010

The Bureau of the Public Debt today announced earnings rates for Series I Savings Bonds and Series EE Savings Bonds, issued from May 2010 through October 2010. Earnings rates for I bonds and fixed rates for EE bonds are set each May 1 and November 1. Interest accrues monthly and compounds semiannually. Bonds held less than five years are subject to a three-month interest penalty. Both series have an interest-bearing life of 30 years; the EE bond fixed rate applies to a bond’s 20-year original maturity.

I Bond Earnings Rate of 1.74% includes Fixed Rate of 0.20%
The earnings rate for Series I Savings Bonds is a combination of a fixed rate, which applies for the life of the bond, and the semiannual inflation rate. The 1.74% earnings rate for I bonds bought from May 2010 through October 2010 also will apply for the succeeding six months after the issue date. The earnings rate combines a 0.20% fixed rate of return with the 1.54% annualized rate of inflation as measured by the Consumer Price Index for all Urban Consumers (CPI-U). The CPI-U increased from 215.969 to 217.631 from September 2009 through March 2010, a six-month increase of 0.77%.

Series EE Bonds Issued May 2005 and After
Series EE bonds issued from May 2010 through October 2010 will earn today’s announced rate of 1.40%. (Series EE bonds issued since May 2005 are earning interest at a fixed rate, depending on the rate set when the bond was issued).

Series EE Bonds Issued from May 1997 through April 2005
Series EE bonds issued from May 1997 through April 2005 continue to earn market-based interest rates set at 90% of the average 5-year Treasury securities yields for the preceding six months. The new interest rate for these bonds, effective as the bonds enter semiannual interest periods from May 2010 through November 2010, is 2.16%. Market-based rates are announced effective each May 1 and November 1.

Series EE Bonds Issued Before May 1997
Series EE bonds issued before May 1997 earn various rates for semiannual earnings periods, depending on dates of issue. Please visit Public Debt’s website for more information.

Matured Series EE/E Savings Bonds and Savings Notes
All Series E savings bonds will no longer earn interest after June 2010. Additionally, Series EE savings bonds are beginning to reach final maturity, and, therefore, will stop earning interest. Series EE bonds issued from January 1980 through May 1980 are no longer earning interest, and those issued from June 1980 through October 1980 will stop earning interest during the next six months. All U.S. Savings Notes (Freedom Shares), which were issued from May 1967 through October 1970, have also stopped earning interest.

More Information
To find more information on savings bonds and which ones are still earning interest, visit Public Debt’s website Earnings Reports, with rates and yields for Series I and EE bonds also can be found on the site. The website provides information and instructions for opening an on-line account to purchase electronic savings bonds and Treasury marketable securities: bills, notes, bonds and TIPS (Treasury Inflation Protected Securities).