Discover the soaring potential: Unveiling the pinnacle of interest rates in 15 years – How far will savings rates surge?


Savings Rates Reach Highest Levels Since 2008 After Multiple Interest Rate Increases

Savings rates have soared to their highest levels since 2008, following a series of interest rate increases. This upward trend has been observed across all variable rates, including easy access, notice, and ISA equivalents, making it the 19th consecutive month of rate hikes. According to financial analysts Moneyfacts, this is a record-breaking achievement. The average rates for easy access and notice accounts have reached their peak in 15 years, with the former rising to 2.95% and the latter to 4.04%. Additionally, the average easy-access ISA rate has risen to 3.04%, the highest since December 2008 when it stood at 3.74%. The Bank of England is expected to further increase rates from 5.25% to 5.5% on Thursday, continuing the trend of rate hikes.

Despite the significant rate increases, experts believe that savings rates might be close to reaching their peak. Andrew Hagger from Moneycomms suggests that fixed-rate savings and ISAs are reaching their pinnacle. Although there might be a slight rise in easy access rates if the Bank of England implements a 0.25 basis point increase on Thursday, Hagger predicts that rates will gradually start to decline. However, due to intense competition in the savings market, any decrease in rates is unlikely to be sharp. Therefore, it is recommended that individuals review their savings rates promptly and consider moving their funds to the most rewarding options available while rates are still favorable.

The push for higher savings rates came after MPs questioned bank executives about the increasing mortgage rates while savings rates remained stagnant. This scrutiny sparked competition among banks and led to a surge in the number of people switching accounts. Rachel Springall, a finance expert at Moneyfacts, explains that challenger banks’ intense competition has resulted in rising average fixed rates over the past six months. This is great news for individuals coming to the end of their fixed bonds or ISAs, as they can now expect significantly higher returns.

Comparing the average one-year fixed rate from September 2022 to the current rate, there has been a remarkable increase. The rate has risen from 2.29% to 5.34% for a £20,000 lump sum investment, which translates to an additional £610 in interest after one year.

However, according to James Blower, the founder of Savings Guru, the peak of rates depends on the type of product. He believes that fixed savings rates have already reached their highest point. With the base rate expected to peak around a maximum of 5.75% (with some economists predicting 5.5%), the current rates of 6% and over are likely to disappear. These rates are currently inflated due to the presence of NS&I, which offers a rate of 6.2%. Once NS&I is gone, rates of 6% for one-year terms will become scarce and are likely to disappear altogether by year-end.

On the other hand, easy access rates are expected to rise further if the base rate increases. However, savers are encouraged to act swiftly, as rates tend to disappear from the market quickly. Springall advises savers to sign up for rate alerts to stay informed since the shelf life of fixed-rate products has decreased to 32 days, compared to 46 days six months ago.

Best One-Year Fixed Rates

  • National Savings & Investments – 6.20%
  • Union Bank of India (UK) Ltd – 6.11%
  • Ahli United Bank (UK) plc – 6.10%
  • Kent Reliance – 6.06%
  • SmartSave – 6.06%
  • OakNorth Bank – 6.05%

Best Two-Year Fixed Rates

  • Ford Money – 6.05%
  • Ikano Bank – 6.05%
  • Union Bank of India (UK) Ltd – 6.05%
  • GB Bank – 6.01%
  • OakNorth Bank – 6.00%
  • Cynergy Bank – 6.00%

Best Easy-Access Rates

  • Paragon Bank – 5.05%
  • Kent Reliance – 5.01%
  • Monument Bank – 5.01%
  • Gatehouse Bank – 5.00%
  • Yorkshire Building Society – 5.00%
  • Furness Building Society – 5.00%
  • Scottish Building Society – 5.00%


Micheal Kurt

I earned a bachelor's degree in exercise and sport science from Oregon State University. He is an avid sports lover who enjoys tennis, football, and a variety of other activities. He is from Tucson, Arizona, and is a huge Cardinals supporter.

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