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Base rate remains at 0.5%

Base rate remains at 0.5%

Category: Economy

Updated: 09/09/2010
First Published: 09/09/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Bank of England delivered no surprises at noon today, as it announced that the base rate of interest will remain at 0.5% for at least another month.

The measure has been frozen at the historical low point since March 2009.

There is real uncertainty over when it will eventually rise, although many analysts and commentators have cited next year as the most likely time.

Others have said it will remain at 0.5% for some time longer. A report by Ernst & Young said that rates could stay at 0.5% until 2014.

In the Monetary Policy Committee's (MPC) three previous monthly meetings, Andrew Sentance has broken ranks by voting for a rise to 0.75%.

He has found himself significantly outnumbered by all other members of the MPC.

A report later in the month will show whether Mr Sentance or, indeed, any of his fellow members voted to increase interest rates.

The latest freeze comes as little shock, and savers could be forgiven for thinking that respite is still some way off, especially with the effects of high inflation.

Despite the tough conditions, savers can still find accounts worth investing in.

For savers eager to fix their rate for a year, a rate of 2.80% is available from the Post Office.

Those keen to lock their money away for slightly longer can get a two year bond from Coventry BS that pays a rate of 3.70%.

Over the longer term, the State Bank of India's four year account offers an interest rate of 4.20%.

To compare all savings accounts from across the market, check the Best Buy tables.

Find the best savings rates for you - Compare savings accounts

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