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Commenting on the base rate rise and what it means for savers, Laura Suter, head of personal finance at AJ Bell explained the MPC’s latest report points out that easy-access savings rates have risen by “significantly less” than in previous rate-rise cycles, which has pushed more savers into fixed-term accounts in search of higher rates.
She stated that the fire in the savings rates war has died out a little in the past couple of months, but another boost to interest rates should help to rekindle it.
Ms Suter said: “A bigger factor is the government’s move in last week’s Budget to task NS&I with raising even more money from savers this year.
“The mandate means the government-backed provider will have to increase rates and boost its Premium Bond prize fund in order to draw in more savers – a task it’s already struggling to do. This in turn will prompt other providers to up their ante to keep savers’ money.
