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The U.S. Department of the Treasury announced new rates for Series I bonds.
The newly purchased I Bonds will pay 5.51% annual interest from November 1 to April 30, which is up from the 4.26% yield offered for purchases made through October 31.
The new rate includes a variable part of 4.08% based on inflation data and a fixed part of 1.40%. The fixed rate is up from the 0.90% announced in April and is the highest rate since 2006.
In total, the Composite I Bond rate is 5.51% after rounding, according to the Treasury.
Amid the post-pandemic inflation spike, the I-bond rate hit a record high of 9.62% in May 2022, and investors have poured millions into this nearly risk-free government-backed asset.
As inflation slowed and I-bond yields fell, many short-term investors bought back their I-bonds. But investors could return as inflation pushes bond yields back up, experts say.
“I bonds are much more attractive at this point,” said David Enna, founder of Tipswatch.com, a website that tracks Treasury inflation-protected securities, or TIPS, and bond yields.
Bonds are much more attractive at this stage.
David Enna
Founder of Tipswatch.com
The consumer price index rose 3.7% in September 2026 year-over-year, compared to an annual pace of 3.4% in August, the Bureau of Labor Statistics reported in October.
In September, the war in Iran led to rising inflation, which pushed up gasoline and energy prices. Tariffs imposed by President Donald Trump, new artificial intelligence data centers and demand for travel have also contributed to rising prices, economists say.
Consumers expect inflation to continue to rise. In September, the one-year inflation outlook jumped to 3.9%, the highest in more than three years, according to a New York Fed survey released in early October.
How Bond Rates Work
Bond rates include a variable rate part and a fixed rate part, which the Treasury adjusts every six months, in May and November.
The variable rate is linked to inflation – using the percentage change in the Consumer Price Index over six months – and remains the same for six months after your purchase, regardless of the next Treasury update.
Your fixed rate does not change after purchasing I bonds. Treasury does not disclose how it calculates fixed rate adjustments, which makes forecasting more difficult.
Some experts believe the fixed I-bond rate could be determined by the real or inflation-adjusted yields of five-year TIPS, according to Ken Tumin, founder of DepositQuest.com, a blog that tracks I-bond rates, among other deposit accounts.
“There is some uncertainty,” Tumin said.
How the Change Affects Current Bond Investors I
If you currently own I Bonds, rate updates follow a six-month schedule based on your original purchase date.
After holding I Bonds for six months, the variable return moves to the next announced rate. But the fixed rate remains the same for the entire time you own the asset.
For example, let’s say you purchased I bonds in March when the variable rate was still 3.12% and the fixed rate was 0.9%. After six months, the variable portion would increase to 3.34%, announced in April 2026, but your fixed rate would remain at 0.9%.
You can earn interest on I Bonds for up to 30 years, or less if you redeem the assets before then. However, you cannot cash in I Bonds for at least one year after purchasing them. If you redeem your securities within five years, you lose your last three months of interest.
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