Surprise Fall In Inflation Provides Relief For Savers | will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by will always be from Be Scamsmart.

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Derin Clark

Derin Clark

Online Reporter
Published: 24/03/2021
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The Consumer Price Index (CPI) unexpectedly fell to 0.4% during February, which has provided some relief to savers as it has resulted in a month-on-month increase in the number of saving accounts offering inflation-beating rates.

Traditionally clothing prices would rise between January and February, which often sees an increase in inflation, but this year clothing prices fell in this period for the first time since 2007. This has resulted in inflation falling from 0.7% in January to 0.4%.

This fall means that there are now 387 saving accounts and ISAs* that have rates that can match or beat inflation. Of these, 227 are fixed rate bonds, 92 are fixed rate ISAs, 18 are variable rate ISAs, 27 are notice accounts, and 23 are easy access savings accounts.

Visit our saving account and ISA charts to compare all the rates available today.

Despite February’s fall in inflation, it is still predicted that inflation will rise to 2.1% at the beginning of 2022. “The impact of inflation on savings returns may not be as prevalent today due to the fall, but with the expectations for it to rise above 2% this year, soon there may be not one standard savings account that can fight its eroding power,” explained Rachel Springall, finance expert at “Month-on-month there has been a notable drop in the rates offered across some top rate deals, showing signs that cuts are still a frustrating trend.

“Those savers who decide to put their cash in an easy access account may well do so due to the continued uncertainty. If savers are doing so for convenience rather than chasing the top rates, it is still important that they check the terms and eligibility criteria of their account, as there are many easy access accounts now that restrict withdrawals or require savers to open a separate account with the institution to get the top rate.”

She added: “The changing savings landscape from the past 12 months and state of play only reiterate the need for savers to keep a close eye on the top rate deals and act quickly if they wish to take advantage. Challenger banks and mutuals continue to offer some of the best returns this month but there is no guarantee these deals will last long.”

Savers looking for the best rates should regularly check our savings accounts and ISA charts. Alternatively, those looking for a long-term option and who are willing to take a riskier option could consider investing, although those considering this option should be aware that investments can result in investors not making any returns on their investment or, in some cases, losing some or all of their initial capital. For more information about investing, visit our investment pages.


*based on a £10,000 deposit.


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