The new Consumer Price Index report, published Tuesday, shows that inflation continues to cool in the United States. Prices in November rose 3.1% year-over-year. That's a slight decrease from the year-over-year rates of 3.2% rate in October and a significant drop from the height of this inflationary period in June of 2022, when prices were up more than 9% year-over-year. 

With inflation a hot topic, many Americans are wondering what exactly this information means for their pocketbooks, and their savings in particular. While there are a lot of moving parts and one report can't tell us exactly what to expect, there are some possible conclusions that can be drawn about how this latest report will impact savings rates moving forward. 

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What the new inflation report means for savers

Here is what you need to know about what the new inflation report means for savers.

Savings rates could be impacted by the inflation report

It's a big week for economic news, as the inflation report will be followed by the final meeting of the Federal Reserve for 2023, which is being held on December 13. The Fed has chosen to leave the federal funds rate unchanged at the last two meetings, allowing the previous rate hikes to continue working to fight inflation. 

And, with inflation continuing to cool, the Fed may choose to pause rates again. This could lead to savings rates staying where they have been or possibly decreasing slightly. 

"This inflation report supports the market's view that rates will remain steady and potentially go lower," says Erik Nero, a financial advisor at First Step Wealth. 

However, Fed chair Jerome Powell did indicate after the last meeting that the Fed is willing to raise rates again if the economic data supported that move. While inflation has continued to cool, it is worth noting that it still has not reached the Fed's goal of 2% year-over-year inflation. So, the Fed could hike rates again this week, which would potentially cause savings rates to go up.

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This is the time to take advantage of high savings rates

While there is a chance the Fed will raise rates again, the continued cooling of inflation means that rates for high-yield savings accounts and certificates of deposit (CDs) are more likely to decline as we enter the new year. This means that savers who want to take advantage of the current high rates should act fast.

For those interested in saving with a high-yield savings account, opening an account now means you'll earn high interest rates — currently up to 5.50% at some banks — at least for a while. Savings account rates are variable, so if and when rates go down, so will the amount of interest you earn. But even if you are only able to earn that high rate for a few months, compounding interest means that opening this type of account as soon as possible will benefit you in the long run.

If you want to put your savings in a CD it could also benefit you to act quickly. CD rates are locked in when you open the account, so if you want to earn the high interest rates currently being offered — more than 5.75% for some 1-year CDs — you'll want to act fast. That way, even if rates go down dramatically during the term of your CD, you'll earn interest at the rate you locked in for the entire CD term.

The bottom line

With inflation continuing to cool, the heady days of high rates for savers may be starting to move toward an end. There is still time, however, to take advantage of high interest rates for high-yield savings accounts and certificates of deposit. The future will look a bit less murky after the Fed meets this week and decides whether to raise interest rates or keep them paused for a third straight time.