Average fixed savings rates on offer fall to lowest levels for more than a year
Providers will ‘no doubt’ be assessing their market positions over the weeks ahead, financial information website Moneyfacts said.
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Some average fixed savings rates where money needs to be “locked” away have fallen to their lowest levels in at least a year, according to a financial information website.
The average savings rate on accounts requiring notice to be given before the account can be unlocked was 4.21% at the start of this month, its lowest level since October 2023 Moneyfacts said.
The average notice Isa rate fell to 4.03% – also the lowest level since October 2023.
Accounts requiring notice to access savings often pay higher rates than easy access deals which allow money to be accessed from them straight away.
The average easy access rate was 3.07% at the start of October and the average easy access Isa rate was 3.28%.
As we draw nearer to the end of the year, now is a crucial time for savers to review their existing portfolio
The average one-year fixed bond rate was 4.31% the start of October, its lowest point since June 2023.
The average longer-term fixed bond fell to 3.93%, its lowest point since March 2023.
Longer-term accounts were defined by Moneyfacts as those with terms over 550 days.
The average one-year fixed Isa rate fell to 4.18%, its lowest point since June 2023. The average longer-term fixed Isa fell to 3.88%, its lowest point since April 2023.
Rachel Springall, a finance expert at Moneyfacts, said: “Savers looking to secure a guaranteed return may be disappointed to see average fixed rates on bonds and cash Isas drop to their lowest levels in over a year.”
Ms Springall added: “More drops could well be on the way due to expectations that the Bank of England will cut base rate before the year ends.
“Despite the rate cuts, product choice remains resilient across the market. The average shelf-life of a fixed-rate bond rose to 57 days, up from 51 in September, its highest level since March 2022.”
She continued: “As we draw nearer to the end of the year, now is a crucial time for savers to review their existing portfolio.
“Variable rates have not been immune to rate cuts over the past few months, so savers should proactively move their pots if they are getting a poor return on their hard-earned cash.
“Savers need to stay vigilant as providers will no doubt be assessing their market positions over the coming weeks and will be eyeing up the upcoming Budget to see how this may impact future rate expectations.”
Moneyfacts assumed someone would have a £5,000 savings deposit and average rates were taken from the first available day of each month for its analysis.