Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said:

“Inflation impact should not discourage savers from searching and switching to a better deal, as if they fail to do so, they could miss out on an attractive rate. Top rates across the savings spectrum have improved since the last inflation announcement and more improvements may well surface in the coming weeks if providers consider the latest base rate rise and volatility surrounding future interest rate expectations. The savings market overall has come a long way from the record low returns seen in 2021.

“The one-year fixed bond arena takes centre stage for rate volatility as providers have been keen to increase their rates to grab a prominent position in the top rate tables. Several providers now offer 6% to savers who are prepared to lock their money away for at least one year. Those savers who have a maturing one-year fixed bond may well realise the rates are more than double the top rates offered a year ago. This area of the market is brimming with challenger banks, and they traditionally move quickly to attract deposits to fund their future lending. Savers will have to move quickly to grab a top rate from such a volatile market.

“Two years ago, the top rate easy access accounts paid just 0.50%, but there are now a variety of deals that pay more than 4%. These accounts may be more suited to those savers who want flexibility and peace of mind that they can gain access to their cash quickly. However, it’s vital consumers carefully check the terms and conditions of every account, as some can restrict withdrawals. The ISA equivalents are also improving, which is ideal for those who want to use their ISA allowance.

“Savers will need to consider both their short-term needs and long-term goals when comparing the variety of accounts on the market. It is imperative they sign up to rate alerts and newsletters to keep on top of the latest changes to surface and move quickly to secure a deal to not be left disappointed.”

*Data note: Please note that these savings product numbers only include deals that are available to UK residents (easy access, notice, fixed rate bonds, variable or fixed ISAs) and exclude regular savers and children’s savers (this figure does not count each interest payment option for each account), based on a £10,000 deposit. Higher rates may be available for other levels of deposit.