CDs vs. high-yield savings accounts: Which will be better after a September Fed rate cut?

An interest rate cut this September may impact what savers can earn with CDs and high-yield savings accounts. porcorex/Getty Images

The first interest rate cut of 2025 now appears just days away, if projections currently hold.

There's around a 90% chance the Federal Reserve will issue a 25 basis point cut when the central bank's next meeting wraps on September 17 and a 10% chance the Fed moves to make a larger, half a percentage point reduction, according to the CME Group's FedWatch tool.

While that will help borrowers, it will contribute to the loss of interest earnings savers have already started to feel over the last year. Rate cuts in the final months of 2024, for example, consequently lowered returns on certificate of deposit (CD) and high-yield savings accounts . S