Hi Yield Savings Accounts

The Federal Reserve is meeting this week and the central bank is widely expected to hike the short term interest rate to 5.25%. Over the last few months the interest rates in Savings accounts followed the rising trend. Last week some of the leading banks have announced hike in their rates.

Citibank's rate of 5.0% APY is currently the highest without any minimum balance requirement. Previously, their rate was 4.75%.
OneUnited.com (of Los Angeles) is also offering 5.0% with a minimum deposit of only $10.
HSBCdirect and Emigrant-Direct also announced a rate of 4.80% (increased from 4.65%)with no minimum.
PayPal.com money market account currently has a yield of 4.77% with no minimum (not FDIC insured though)
CountryWide is giving 5.25% APY on a deposit of $50000 minimum.
IngDirect.com The current yield is 4.25% with no minimum.

With almost all fingers pointing to inflationary fear, the short term interest rate would probably rise more in coming months. So, it's still not time to lock your money in higher yield CDs. The best you can do to get more than these current rates of savings accounts is to purchase CDs with duration of 6 months or less. Banks like IndyMac.com are offering about 5.45% for a 7 month CD which will mature in January'2007 if you purchase now and is good to avoid paying tax on your 2006 income of interest.