Savers 'nudged' to switch accounts after Bank of England interest rate decision
Savers are being recommended to take advantage of high interest accounts
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Britons are being "nudged" to take advantage of high interest rate savings accounts before likely cut from the Bank of England later this year.
Earlier today, the central bank's Monetary Policy Committee (MPC) overwhelmingly voted to keep the base rate at five per cent.
This is the rate at which Bank charges high street banks and lenders which impacts how much people are charged for loans and mortgages.
A survey of economists and financial experts conducted by finder.com found that half of respondents believe interest rates will fall to 4.75 per cent by the end of the year.
Some 30 per cent of those polled are of the opinion that the base rate will plummet to 4.5 per cent as 2024 draws to the close.
While borrowers have been hit hard by the Bank of England's decision-making, savers have benefited over the period but high interest rate accounts could be withdrawn from the market in the near future.
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Earlier this year, the Bank of England voted to cut interest ratesGETTY Liz Edwards, finder's money expert, noted that the Bank's decision will be "disappointing" for many but outlined what savers should expect in the month ahead.
"If you’ve got money stashed away in your savings, today's decision serves as a nudge to take advantage of higher interest rates on fixed-rate accounts," she explained.
“Research from finder previously revealed that eight of the 16 biggest banks in the UK have already lowered their easy-access savings account rates since the Bank of England cut the base rate at the beginning of August.
"It likely won’t be long before the rest follow suit, particularly with many factoring in the next rate cut expected to happen in November."
Based on finder's survey, 78 per cent of money experts think the average one-year fixed rate ISA will fall by one per cent by December.
Edwards added: "There are currently some great deals that can help your money go further, and if you fix now you can guarantee your returns even once the base rate has fallen."
She recommended Zopa's Two-Year Smart ISA and NatWest fixed-rate One-Year ISA which are offering 4.4 per cent and 4.3 per cent, respectively.
The money expert shared: "The average person in the UK has £11,185 in savings, and with this NatWest account you could earn more than £480 in interest on your savings in just 1 year."
Banks, such as first direct, HSBC and the Co-Operative, are currently offering accounts with interest rates as high as seven per cent.
According to the Current Account Switch Service (CASS), more than 100,000 switches to accounts with better incentives, including high interest products, are being processed a month.
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GETTYJohn Dentry, the product owner of the CASS at Pay.UK, said: "While this may stabilise falling rates on savings accounts, banks are still having to find new ways to compete for customers.
"This is why we’re seeing some of the highest switching levels ever recorded, often processing over 100,000 switches a month."
The Bank of England's next base rate announcement will take place on November 7, 2024.
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