Savers looking to lock in an attractive deal are in luck: rates have hit their highest levels since 2008.
Average rates on one-year and long-term fixed-rate bonds and fixed-rate ISAS have fallen above 5 per cent for the first time since 2008, Moneyfacts data shows.
Average savings rates on Easy Access Notice Accounts and equivalent Isas are now at levels not seen for 15 years.
Rates for easy access accounts, notice accounts, easy access Isas and notice Isas have risen for the 19th consecutive month, the first time on Moneyfacts’ records since it began recording this data in 2007.
At the top: Average savings rates have reached their highest levels since 2008
The average easy access savings rate has risen to 2.95 percent and is at its highest level since November 2008.
Notice account rates have risen to 4.04 per cent, topping 4 per cent for the first time since March 2008, which was also their previous peak in Moneyfacts’ records.
The average easy access Isa rate has risen to 3.04 per cent and is at its highest since December 2008 and note that Isa rates have risen to 3.8 per cent, the highest since November 2008 .
Fixed savings rates and fixed Isa rates have increased monthly for the last six months. The average one-year fixed bond rose to 5.34 percent and is at its highest point since November 2008.
Longer-term fixed bonds – those with terms greater than 500 days – rose to 5.12 percent and are at the highest peak since November 2008.
The average one-year fixed Isa rose to 5.19 per cent, the highest point since November 2008.
The average long-term fixed rate Isa rose to 5.02 per cent and is at its highest point since November 2008.
How close are we now to the top of the market?
Savings experts believe fixed rate bonds and Isas have peaked.
James Blower, founder of the Savings Guru website, believes NS&I’s flagship fixed-rate bond, which pays a bumper rate of 6.2 per cent, may only be available for about another week.
Rachel Springall, finance expert at Moneyfacts, points out that The average lifespan of fixed-rate bonds is 32 days, down from 46 days six months ago, according to data from Moneyfacts.
She says: “This means savers will have less time to purchase a fixed rate bond compared to the start of the year, so it is imperative they sign up for rate alerts to stay informed.”
You can get ahead of the pack with the best savings rates by signing up to our Savings Alert service to find out about the best deals as they arrive.
| Account type | September 21st | September 22 | Aug-23 | September 23 |
|---|---|---|---|---|
| Easy access average rate | 0.17% | 0.84% | 2.80% | 2.95% |
| Easy Access ISA Average Rate | 0.24% | 0.92% | 2.86% | 3.04% |
| Average notice rate | 0.47% | 1.41% | 3.83% | 4.04% |
| Average notice ISA rate | 0.31% | 1.21% | 3.64% | 3.89% |
| Average one-year fixed rate bond | 0.67% | 2.29% | 5.18% | 5.34% |
| Average longer-term fixed rate bond | 0.94% | 2.67% | 5.00% | 5.12% |
| ISA average fixed rate for one year | 0.49% | 1.96% | 5.00% | 5.19% |
| Longer Term Fixed Rate Average ISA | 0.79% | 2.35% | 4.91% | 5.02% |
| Source: Treasury report on UK savings trends from Moneyfacts | ||||
Easy access accounts may still have a ways to go and could get a boost if the base rate moves to 5.5 percent later this week.
Andrew Hagger, founder of personal finance website MoneyComms, says: ‘I think we’re pretty much at the top now when it comes to fixed-rate bonds and Isas.
‘We may see a small further rebound in easy rates if the Bank of England raises rates by 0.25 basis points on Thursday, as many economists predict.
‘The August inflation figures due out on Wednesday are expected to show a further reduction in CPI inflation, so I think rates will slowly start to fall.
‘However, the intense level of competition means it will be gradual and we are unlikely to see rates drop like a stone.
“If you haven’t checked your savings recently, now is a good time to check your rate and upgrade to a higher rate while you can.”
Earlier this month, Bank of England Governor Andrew Bailey told MPs at a Treasury Committee meeting that rates were “much closer to the top of the cycle” following last month’s base rate rise. , which was the fourteenth consecutive, up to 5.25. percent.
Some economists believe there is now a chance that there will be only one further increase in the base rate, or even none at all.
But most agree that the Monetary Policy Committee will raise rates again at its next meeting this week by between 0.25 percent and 5.5 percent.
Because of this, Anna Bowes, co-founder of the Savings Champion website, says: “For savers it could mean now is the time to lock in some of the great rates currently available, before the base rate peaks and then potentially start to increase.” fall once more.’
Springall says: ‘Savers may be delighted to see average rates reaching levels not seen since 2008. Average rates on one-year fixed and long-term bonds and Isas are above 5 per cent for the first time in almost 15 years.
‘Due to intense competition between challenger banks, average fixed rates have increased over the past six months. This will be good news for those coming to the end of their fixed bonus or Isa, as they will be able to find much higher returns.’
‘Savers who want flexibility with their cash will find the average easy access rate has risen to 2.95 per cent, its highest point since November 2008, when it was 3.63 per cent.
‘At the time, the Bank of England’s base rate was 4.5 per cent; now it is 5.25 percent.
This means that the gap between the average easy access account rate and the base rate was much narrower in 2008, when it was 0.87 percentage points, than today, where it stands at 2.3 percentage points.
Springall adds: “There is room for improvement and some savers may not feel the full benefits of consecutive base rate increases, nor could they get the best possible return by not switching.”
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