There's good news and bad news for people who like to buy U.S. savings bonds.

The good news is that the government increased the interest rate for the Series I bond, a type intended to offer bondholders some protection from inflation.

As a result, if you buy a Series I bond now through April, it'll earn interest at an annualized rate of 4.08 percent. That's up from 2.57 percent for I bonds purchased from May through October.

"In a tight, conservative, low-interest-rate environment, that's a pretty big jump," said Daniel J. Pederson, president of BondHelp.com, a Web site based in Detroit that provides details on savings bonds.

The new, higher rate also makes Series I bonds more competitive with other conservative places to park your cash, such as money-market mutual funds, which have generally been yielding about 1 percent a year, and certificates of deposit, which have generally been yielding 1 percent to 3 percent or more (depending on the term), Pederson said.

The bad news is that the rate on Series EE bonds - also known as Patriot bonds - has dropped a bit. So if you buy a Series EE bond now through April, it'll earn interest at an annualized rate of 3.25 percent. That's down from 3.96 percent for EE bonds purchased from May through October.

(In general, the rate for Series EE bonds is equal to 90 percent of the average yield on five-year Treasury notes for the preceding six months. So if that yield drops, so does the rate on Series EE bonds.)

Here are other highlights of the semiannual rate changes posted Nov. 1 by the Treasury Department's Bureau of the Public Debt:

The rate on Series I bonds has two components: a variable rate that changes with inflation and a fixed rate that stays with your bond for its entire 30-year life.

The variable rate the government announced, which will apply to Series I bonds purchased over the next six months, is 2.46 percent. That compares with a variable rate of only 0.56 percent that applied over the last six months.

That rise in the variable rate is caused by an increase lately in the national rate of inflation, said Stephen Meyerhardt, spokesman for the Bureau of the Public Debt, which runs the savings bond program.

Without explanation, the government lowered the fixed rate on new Series I bonds. It'll be 1.60 percent for Series I bonds purchased now through April. It was 2 percent for Series I bonds purchased from May through October.

Although that's not a huge drop, it's something to keep in mind, Pederson said. "It tells us that they're going to micromanage the I bond's fixed rate more than they have other rates on other bonds," he said. For instance, Series HH bonds pay a 4 percent annual interest, a fixed rate that's been in effect since March 1993.

Because the government left the rate on Series HH bonds at 4 percent, HH bonds remain an attractive option for the conservative end of your portfolio. (Remember that HH bonds are available only by exchange; you may acquire them only by swapping Series EE or Series E bonds you own. Other types of savings bonds may be bought through most banks and credit unions, through payroll deduction and over the Internet at the bond program's Web site.)