Rachel Springall, Finance Expert at Moneyfacts, said:
“Savers will find a combination of both rises and falls to rates month-on-month, but fixed bond and ISA rates reduced across the spectrum. The longer-term bond average rate has now dropped by 0.90% in the past six months alone, with the one-year equivalent falling by 0.78% over the same period. It is worth noting that the extent of the latest month-on-month cuts were more subdued than seen over the past six months. Indeed, between the start of January and February 2024, the average longer-term bond rate fell by a staggering 0.34%, the biggest monthly cut seen in 15 years. The volatility surrounding the shelf-life of a fixed rate bond has calmed, rising to 37 days. Year-on-year, fixed bonds are paying much higher rates and could still appeal to savers hoping to get a guaranteed return on their cash. Indeed, the average one-year fixed bond paid less than 4% in May 2023, and the average longer-term fixed bond paid slightly over 4%. Those coming off a fixed rate bond would do well to consider the challenger banks which offer some of the best fixed bond rates, enticing deposits to fund their future lending.
“Savers looking for a flexible pot for their cash will find the average return on an easy access account held firm at 3.11%, which is positive, as last month it experienced its biggest monthly drop since June 2020. The last time the rate did not rise, or fall month-on-month, was at the start of December 2021. However, savers will still need to proactively check their accounts regularly and switch if they are getting a poor return. Variable rates on easy access and notice accounts have been generally resilient in recent months, and year-on-year, are paying over 1% more across the board, which includes easy access and notice Cash ISAs.
“The choice of Cash ISAs rose to 547, a record high since our electronic records began. The number of providers to offer a Cash ISA also rose up from 91 at the start of April to 95 the beginning of May. This was the biggest month-on-month rise in providers in three years and marks the highest number of Cash ISA providers in more than 15 years. As providers enter the market and improve the availability of products in the aftermath of a busy ISA season, it will be interesting to see whether product choice continues to flourish in the coming months.”
Rachel Springall, Finance Expert at Moneyfacts, said:
“Savers will find a combination of both rises and falls to rates month-on-month, but fixed bond and ISA rates reduced across the spectrum. The longer-term bond average rate has now dropped by 0.90% in the past six months alone, with the one-year equivalent falling by 0.78% over the same period. It is worth noting that the extent of the latest month-on-month cuts were more subdued than seen over the past six months. Indeed, between the start of January and February 2024, the average longer-term bond rate fell by a staggering 0.34%, the biggest monthly cut seen in 15 years. The volatility surrounding the shelf-life of a fixed rate bond has calmed, rising to 37 days. Year-on-year, fixed bonds are paying much higher rates and could still appeal to savers hoping to get a guaranteed return on their cash. Indeed, the average one-year fixed bond paid less than 4% in May 2023, and the average longer-term fixed bond paid slightly over 4%. Those coming off a fixed rate bond would do well to consider the challenger banks which offer some of the best fixed bond rates, enticing deposits to fund their future lending.
“Savers looking for a flexible pot for their cash will find the average return on an easy access account held firm at 3.11%, which is positive, as last month it experienced its biggest monthly drop since June 2020. The last time the rate did not rise, or fall month-on-month, was at the start of December 2021. However, savers will still need to proactively check their accounts regularly and switch if they are getting a poor return. Variable rates on easy access and notice accounts have been generally resilient in recent months, and year-on-year, are paying over 1% more across the board, which includes easy access and notice Cash ISAs.
“The choice of Cash ISAs rose to 547, a record high since our electronic records began. The number of providers to offer a Cash ISA also rose up from 91 at the start of April to 95 the beginning of May. This was the biggest month-on-month rise in providers in three years and marks the highest number of Cash ISA providers in more than 15 years. As providers enter the market and improve the availability of products in the aftermath of a busy ISA season, it will be interesting to see whether product choice continues to flourish in the coming months.”
