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Savers’ epic search for good rates goes on….

Savers’ epic search for good rates goes on….

Category: Economy

Updated: 20/07/2010
First Published: 10/06/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Savers face another month of frantic searching for the best savings rates, after the Bank of England's Monetary Policy Committee (MPC) today voted to keep the official bank base rate of interest at 0.5%.

It means the base rate of interest has now remained pegged at its record low for 15 months in a row.

However, with the new coalition Government announcing how it intends to battle the UK's burgeoning fiscal deficit in an emergency Budget on 22 June, the lack of movement in interest rates comes as little surprise.

The last time the Bank of England changed the base rate was when it announced a reduction of 0.5 percentage points in March last year.

The news means savers' epic search for the very best savings accounts will have to continue for at least another month.

Although the challenge might seem daunting, there are still some excellent savings accounts around, particularly if you're able to get by without touching your money for a year or two.

Fixed rate bonds typically pay a set amount of interest if you promise to leave your money in the care of the fixed rate bond provider for an agreed length of time.

A medium term fixed rate bond, such as the three year fixed rate bond from ICICI Bank, currently pays 4.15%, while a similar offering from Lloyds TSB is not far behind, paying 4.10%.

Over the shorter term, a rate of 3.00% is available on a one year fixed rate bond from Barnsley BS.

Homeowners, on the other hand, particularly those with a tracker mortgage linked to the base rate, will continue to celebrate, as they carry on reaping the financial benefits of some of the best mortgage deals seen for many a year.

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