Savers are being urged to take advantage of current deals from banks and building societies as four in five savings accounts “beat” inflation.
Customers in the UK have benefited from the Bank of England’s decision to raise the interest rates to 5.25 per cent.
This base rate hike has been passed onto savings account with Britons having the opportunity to earn better returns.
However, said returns have been diminished by inflation with the Consumer Price Index (CPI) rate for October 2022 reaching a record high of 11.1 per cent.
Earlier this week, figures from the Office for National Statistics (ONS) confirmed that inflation fell to 3.4 per cent last month.
With this drop, many savings accounts are offering interest rates much higher than inflation now.
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The majority of savings account currently have a higher interest rate than inflation
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Here is a breakdown of the best savings interest deals for £10,000 gross, depending on the product, according to Moneyfactscompare:
- Easy access account: Ulster Bank – 5.20 per cent
- Notice account: Hinckley & Rugby BS – 5.25 per cent (180-day)
- One-year fixed rate bond: MBNA – 5.27 per cent
- Two-year fixed rate bond: Oxbury Bank – 5.11 per cent
- Three-year fixed rate bond: UBL UK – 4.85 per cent (payable on maturity)
- Four-year fixed rate bond: UBL UK – 4.54 per cent (payable on maturity)
- Five-year fixed rate bond: UBL UK – 4.95 per cent (payable on maturity).
Here is a breakdown of the best ISA interest deals for £10,000 gross, depending on the product:
- Easy access ISA: Moneybox – 5.11 per cent (includes bonus)
- Notice ISA: West Brom BS – 5.10 per cent (60-day)
- One-year fixed rate ISA: Virgin Money – 5.25 per cent
- Two-year fixed rate ISA: UBL UK – 4.81 per cent (payable on maturity)
- Three-year fixed rate ISA: UBL UK – 4.59 per cent (payable on maturity)
- Four-year fixed rate ISA: UBL UK – 4.30 per cent (payable on maturity)
- Five-year fixed rate ISA: UBL UK – 4.52 per cent (payable on maturity).
For context, there were no deals that could beat a 10.4 per cent CPI rate this time last year.
Furthermore, there were no deals that could beat 6.2 per cent inflation in March 2022.
LATEST DEVELOPMENTS:
The Bank of England base rate is at a 15-year high of 5.25 per cent GB NEWSJames Hyde, a spokesperson for Moneyfactscompare, shared: “This fall in CPI means that 80 per cent of standard savings accounts currently beat inflation, a far cry from this time last year when none were able to do that.
“Some top fixed rates have decreased slightly over the past month, though activity in the market has been mixed recently - with some providers raising their interest paid in recent weeks.
“Top variable rates across savings accounts and ISAs continue to hold very steady as they have in recent months, though any potential reduction in base rate may precipitate more movement in this area of the market.
“It remains the case, despite the Financial Conduct Authority’s continued focus on Consumer Duty, that big banks are still failing to offer variable rates which are competitive with the rest of the market.”
