Discover Bank has been aggressively raising rates lately and recently raised the rates on its 5 Year and 4 Year CDs.

Its 5-Year CD is now paying 5.28% APY and its 4-Year is paying 5.02% APY. It also offers one of the top 2-Year CD rates at 4.41% APY and one of the top 3-Year CD rates at 4.81% APY.

There is a minimum balance of $2,500 to open a CD.

For more, visit the BestCashCow Discover Bank Page.

WaMu is now offering 12 and 13 month CDs at 5%, which are the top rates for certificates of deposit at these terms. The high rates clearly reflect the bank's dramatic efforts to attract capital.

WaMu is also offering an attractive 3.75% APY Savings Account.

While these rates are very competitive, depositors should keep in mind that WaMu has suffered greatly due to the credit crisis. Its stock has dropped from a 52-week high of 39 to just over $3. Depositors should stay below the $100,000 FDIC insurance limits.

The Federal Reserve Open Market Committee meets tomorrow and it's almost certain that they'll vote to keep rates at 2%. The Fed Funds Rate Predictor puts the probability at almost 90%.

But after that, markets seem to expect rates to rise. Bloomberg reports that:

"There are widespread expectations among traders for a rate rise in the next three months: There are 36 percent odds of a boost in August and 93 percent in September, according to futures contracts on the Chicago Board of Trade. Economists in a monthly Bloomberg survey through June 11 projected the Fed will keep the rate at 2 percent this year, according to the median estimate."

Bernanke may be one of the reasons.

"Federal Reserve Chairman Ben S. Bernanke, by voicing concern about inflation and the slumping dollar, has fanned investor expectations for an interest-rate increase as soon as August. He may regret it"

Faced with a weak economy, Bernanke may have to choose between two uncertain options. William Poole, the former governor of the St. Louis Fed had this to say on Bloomberg TV:

``The issue here is whether the Fed is willing to risk an escalation of inflation and then a bigger recession later, or acts earlier, taking a risk of a smaller recession, but preventing inflation from getting out of hand"

If banks are any indication than they are also anticipating a rate increase. BestCashCow has received a steady stream of rate increases on CDs over the last several weeks and rates on 1 year CDs are now at or above 4% APY and the rate on 3 year CDs are now at 5% APY.