Introduction
The US Treasury has set a new interest rate for Series I savings bonds: 5.51% for the next six months. That is up sharply from the previous rate of 4.26%, and it is the highest I bond rate since November 2022. For savers, the more important number may be hiding underneath it.
What Happened
The Treasury announced the new combined rate of 5.51% on Friday, October 30. It applies to I bonds bought from November 1, 2026 through April 30, 2027, and the rate is locked in for six months from the date of purchase.
The combined rate has two parts. The first is a fixed rate, which stays with the bond for its entire life of up to 30 years. The second is an inflation rate, which resets every six months based on actual inflation. For this round, the fixed rate is 1.4% and the inflation part works out to 4.08% on an annualised basis. Combined using the Treasury’s formula, that gives 5.51%.
The 1.4% fixed rate is the real headline. It is the highest fixed rate on I bonds since November 2006 — nearly 20 years. The previous fixed rate was 0.90%.
Why It Happened
The jump comes mostly from inflation. Over the six months from April to September, consumer prices rose 2.04%, which translates into the 4.08% annualised inflation part of the rate. Consumer prices overall rose 3.7% in September 2026 from a year earlier, up from 3.4% in August.
The fixed rate is different: the Treasury sets it based on market conditions, and it chose to raise it to 1.4%. That decision matters far more than a single six-month rate, because the fixed rate never changes for as long as you hold that bond.
Why It Matters
Think of an I bond as two promises stacked together. The fixed rate is a guaranteed return above inflation, for up to 30 years. The inflation part makes sure your money keeps its purchasing power. Put together, you get a return that rises when inflation rises — something regular savings accounts and most bonds do not offer.
At 5.51%, the starting rate is also higher than what short-term government bills are paying right now, at around 4.11%. And I bond interest is exempt from state and local taxes, though federal tax still applies.
There are limits, though. You can only buy $10,000 of I bonds per person per calendar year through TreasuryDirect, the government’s official site. You cannot sell for the first 12 months, and if you sell before five years, you lose the last three months of interest as a penalty.
What Happens Next
Anyone who already used up their $10,000 limit for 2026 will have to wait until January to buy more — but they will still be in time, because the 5.51% rate runs until the end of April 2027. Buying later in the window still earns a full six months at that rate, and the 1.4% fixed rate stays for the life of the bond.
One practical tip that experts repeat: if you buy in November, you earn a full month of interest no matter which day of the month you buy. So there is no rush to buy on day one.
The next reset comes on May 1, 2027. At that point, the inflation part will change again, but the 1.4% fixed rate on bonds bought now will not.
Final Thoughts
The 5.51% rate will grab attention, but the 1.4% fixed rate is the part that could matter for decades. A bond bought in this window keeps that fixed rate above inflation for up to 30 years. For a saver who wants a safe, inflation-protected place for money they will not need for at least a year, this is one of the strongest I bond deals in 20 years. Just remember the limits: $10,000 a year, one year locked in, and a penalty for early exit before five years.
Key figures
- New combined rate: 5.51% (was 4.26%)
- Fixed rate: 1.4% (was 0.90%; highest since November 2006)
- Inflation part: 4.08% annualised
- Applies to: bonds bought November 1, 2026 – April 30, 2027
- Annual purchase limit: $10,000 per person
- Lock-in: 12 months; 3-month interest penalty if sold before 5 years
Disclaimer: This article is for educational and informational purposes only and does not constitute financial advice.
Sources: CNBC — https://www.cnbc.com/2026/10/30/treasury-i-bond-rate-through-april-2027.html — and Money coverage of the new rate; TreasuryDirect rate information.
