The 2022–2023 rate-hike cycle exposed a gap most savers never see: the Fed can move its benchmark rate by hundreds of basis points while the rate on ordinary savings moves far less. Selected online savings accounts behaved very differently. Now, with short Treasury yields and competitive savings rates sitting relatively close together, the question is not simply where rates are going. It is how much of the Fed’s move actually reaches your cash.
The Federal Reserve can change its policy rate with a single announcement.
Your bank does not have to move your savings rate by the same amount.
That distinction became unusually clear during the last major tightening cycle.
From March 2022 through July 2023, the Fed raised its target range from 0.00%–0.25% to 5.25%–5.50% — a cumulative increase of 525 basis points across 11 hikes.
The savings rates Americans actually received moved very differently.
The FDIC’s national savings-rate series rose by roughly 36–37 basis points over the comparable period — only about 7% of the Fed’s cumulative increase.
Selected leading online savings accounts, including Marcus and Ally, moved much closer to the Fed. Their advertised APYs rose by roughly 365–400 basis points during the cycle, or approximately 70%–76% of the Fed’s cumulative move.
Those figures are not a formal HYSA deposit beta, and they do not describe every online bank. They are account-level historical comparisons.
That distinction matters now because competitive savings rates and short-term Treasury yields are relatively close.
A single 25-basis-point Fed move therefore does not automatically tell you what will happen to your cash — or which place is better for it.
The important question is what happens between the Fed’s decision and the rate on your account.
The Fed moves first. Your bank decides what reaches your account.
The Federal Reserve controls the federal funds target range. It does not set the APY on your savings account.
Banks set deposit rates themselves.
That creates a transmission chain:
Fed policy → bank deposit pricing → savings APY → return on your cash
The first number is public and immediate.
The last number is what matters to the saver.
The two do not have to move by the same amount or at the same speed.
The Federal Reserve has a formal way to study this relationship through deposit beta — a measure of how much deposit rates change relative to a change in the federal funds target range.
But a formal deposit beta is not the same thing as taking the beginning and ending APYs of one savings account and dividing its change by the Fed’s change.
That is why the historical comparison here is deliberately narrower.
It asks what happened to the national savings rate and to selected competitive online savings accounts during the same tightening cycle.
The Money Traces rate-transmission map
| Rate layer | 2022–2023 change | What it tells us |
|---|---|---|
| Federal Reserve target range | +525 bp | The full policy-rate move |
| FDIC national savings-rate series | +36–37 bp | Roughly 7% of the Fed’s cumulative move |
| Selected Marcus / Ally savings APYs | ~+365–400 bp | Roughly 70–76% of the Fed’s cumulative move |
This is not a sector-wide beta calculation.
The first row is the Fed’s policy move.
The second is the FDIC national savings-rate series.
The third uses selected account examples.
But the contrast exposes the mechanism that matters to a saver:
The Fed can move the policy rate by hundreds of basis points while the amount reaching an individual savings account depends heavily on where that account sits in the banking market.
That is the part a single Fed announcement cannot tell you.
The 525-basis-point Fed move did not reach the average savings account
The numbers are striking.
The Fed moved its target range up by:
525 basis points
The FDIC national savings-rate series moved by roughly:
36–37 basis points
That means the national savings rate captured only about:
7% of the Fed’s cumulative tightening.
This does not mean banks simply ignored the Fed.
It means the national average and the most competitive deposit accounts were experiencing very different pricing environments.
The FDIC series represents the broader banking system. It should not be treated as a measure of what a highly competitive online savings account offered.
That distinction is important because the next comparison looks very different.
Some online savings accounts moved much closer to the Fed
Marcus started the 2022 tightening cycle around 0.50% on its savings account.
By the peak of the cycle and afterward, reported advertised rates reached roughly the mid-4% range.
Depending on the exact dates and source used for the peak, that represents an increase of roughly 365–400 basis points.
Ally followed a similar broad pattern, moving from about 0.50% early in the cycle to the mid-to-high 4% range.
For these selected account examples, the cumulative increase was therefore roughly 70%–76% of the Fed’s 525-basis-point move.
The comparison is useful precisely because it has limits.
It does not establish that the entire online-bank sector passed through 70%–76% of the Fed’s hikes.
It does not establish a sector-wide HYSA beta.
And it does not mean every bank followed Marcus or Ally.
It shows something more specific:
The response of your particular savings account can be radically different from the national average.
Why that matters now
As of mid-September 2026, competitive savings accounts were offering rates in roughly the high-3% to low-4% range, with some higher advertised offers carrying conditions, balance requirements or other restrictions.
Short-term Treasury yields were also around the low-4% range, depending on maturity and the exact day.
The gap between the two can therefore be relatively small.
That makes the next Fed move less important by itself than the way the banking system responds to it.
Suppose the Fed raises rates by 25 basis points.
Your savings account does not automatically rise by 25 basis points.
The bank could pass through:
| Hypothetical bank response | What happens to the savings APY |
|---|---|
| 0 bp | No increase |
| +10 bp | Partial pass-through |
| +15 bp | Partial pass-through |
| +25 bp | Full pass-through |
These are scenarios, not forecasts.
They illustrate the variable the Fed announcement leaves unanswered.
A 25-basis-point move can be real without being huge
The dollar value of a rate difference depends on the balance.
A 10-basis-point annual difference is approximately:
| Cash balance | Approx. annual difference |
|---|---|
| $25,000 | $25 |
| $50,000 | $50 |
| $100,000 | $100 |
| $250,000 | $250 |
Those figures are before tax and illustrate only the effect of a 10-basis-point annual difference.
That puts the 25-basis-point Fed discussion in perspective.
For most ordinary balances, one isolated 25-basis-point move does not create a dramatic dollar event.
At larger balances, however, even small rate differences become measurable — particularly if the difference persists for months rather than days.
So the relevant question is not simply whether the Fed moves.
It is how much of that move reaches your balance and for how long.
The real competition is between repricing and certainty
A savings account and a short Treasury solve different cash-management problems.
A savings account gives you ongoing access to your money while its APY can change.
A Treasury bill can lock in its stated yield for its maturity if held to maturity.
That creates two different types of rate exposure.
Savings account
Your rate can rise if the bank raises its APY.
It can also fall if the bank lowers the rate.
Short Treasury
The yield is locked for the relevant maturity.
But the money is not being held in the same immediately accessible deposit structure as a savings account.
The choice therefore involves more than today's headline APY.
It involves:
rate → repricing → liquidity → taxes → holding period
No single number settles all five.
Taxes can change a small rate difference
There is another difference that can matter.
Interest from U.S. Treasury bills, notes and bonds is generally taxable at the federal level but exempt from state and local income taxes.
Bank interest is generally taxable at the federal level and may also be subject to state and local income taxes.
So two investments with similar advertised yields can produce different after-tax results.
For someone in a state with a meaningful income-tax rate, the Treasury's state and local tax exemption can improve its relative position.
But that is not a universal conclusion.
The actual result depends on the available rates, the holding period and the taxpayer's circumstances.
The part of the rate cycle most savers miss
The historical lesson is not only that some banks raised rates more than others.
Available tracker and bank-behavior evidence also points toward an asymmetry during easing: savings rates have tended to fall faster or more completely than they rose during the prior tightening cycle.
That observation needs a qualification.
It comes from selected-account and tracker evidence, not from a continuous official series covering every savings account.
Still, it highlights an important feature of variable-rate cash.
The relationship between Fed policy and your savings APY is not necessarily a one-for-one mechanical transmission in either direction.
The path of rates can matter as much as the headline decision.
So what is the decision today?
The evidence does not support a universal answer such as "Treasuries are better" or "keep everything in a HYSA."
The more defensible conclusion is narrower.
If the Fed makes a single 25-basis-point move, the immediate dollar impact on most ordinary cash balances is likely to be modest unless the balance is large, the rate difference persists, or the bank's repricing is unusually slow or incomplete.
At balances around $100,000 to $250,000 or more, relatively small differences become more material.
State taxes can improve the relative economics of Treasuries.
Liquidity can increase the value of a savings account.
And the bank's actual repricing can matter more than the Fed's announcement itself.
That is the hidden variable.
The Fed's rate is only the first number
The 2022–2023 cycle provides a useful warning against treating a Fed decision as a direct forecast for your savings APY.
The Fed raised rates by:
525 basis points
The FDIC national savings-rate series rose by:
roughly 36–37 basis points
Selected leading online savings accounts rose by:
roughly 365–400 basis points
Three very different numbers emerged from the same monetary-policy cycle.
For today's saver, the important chain is therefore:
Fed decision → bank repricing → actual savings APY → after-tax return → cash decision
The Fed controls the first step.
Your bank controls a crucial part of the second.
And your balance, tax situation, holding period and liquidity needs determine what the final difference is worth to you.
That is why the smartest question after a Fed move is not simply:
"What did the Fed do?"
It is:
"What happened to the rate on my cash?"
Money Verdict
What we know
The 2022–2023 tightening cycle shows that the Fed's policy move and the rate paid on savings accounts can diverge substantially.
The Fed raised its target range by 525 basis points.
The FDIC national savings-rate series rose by roughly 36–37 basis points, or about 7% of the Fed's cumulative increase.
Selected leading online savings accounts such as Marcus and Ally raised their advertised APYs by roughly 365–400 basis points, or approximately 70%–76% of the Fed's cumulative increase.
What we do not know
We cannot know in advance exactly how much any particular bank will pass through from a future Fed move.
The historical Marcus and Ally comparisons are not a sector-wide HYSA beta.
The timing and size of future repricing remain bank-specific.
What matters for your cash
The relevant calculation is not the Fed's headline rate alone.
It is the rate your cash actually earns, how long it stays there, what happens after taxes, and how much liquidity you need.
That is why a 25-basis-point Fed move can matter without automatically making one cash option universally better than another.
Sources & Methodology
This analysis uses the evidence locked during the Money Traces research and verification process.
Federal Reserve: FOMC rate history and research on deposit-rate transmission and deposit beta.
FDIC / FRED: National savings-rate series, including the deposit-weighted national savings rate.
Historical account evidence: published historical rate records for Marcus and Ally. These are used only as selected account examples, not as a sector-wide measurement.
Current savings-rate comparisons: Bankrate's September 2026 rate table and NerdWallet's savings-rate comparison reviewed in the September 14–15, 2026 verification window. Advertised rates were treated carefully where conditions, balances or eligibility requirements applied.
U.S. Treasury: Daily Treasury yield data and Daily Treasury bill-rate data for September 2026.
IRS: Federal tax treatment of bank interest and U.S. Treasury interest, including the state and local tax exemption for Treasury obligations.
The historical comparison is intentionally limited. The 365–400 basis-point figures for selected online accounts are descriptive account-level comparisons, not formal HYSA deposit betas.
The 25-basis-point discussion is scenario analysis. It assumes different levels of pass-through from a hypothetical Fed move and does not predict how any particular bank will reprice.
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