Savers take advantage as fixed rate savings bond rates on the rise

The average fixed rate savings bond rates have begun to rise since May 2012, according to MoneySupermarket. The current average rate for a two year fix rate bond is 3.76 per cent; an increase of 0.09 percentage points since May. Similarly, one, three, and four year fixes have seen a small increase since May.

Savvy savers are obviously being drawn to these rates, as MoneySupermarket has witnessed an increase of 67 per cent between May and July of savers searching for fixed rate bonds.

Kevin Mountford, head of banking at MoneySupermarket said: "Despite low interest rates, there is still healthy competition among savings providers. With the recent increase in rates from the likes of Yorkshire Building Society, The Co-operative Bank and The AA, savvy savers need to be quick to take advantage as these rates may not hang around for too long. For those who are able to lock their money away for a while, fixed rate bonds are very appealing and the rates are certainly stronger than the lower levels seen over the past year. The average one year rate on a fixed rate bonds is 0.19 per cent higher than the market leading easy access account so even tying your money for a short period can be worthwhile.

"Now could not be a more pivotal time for savers to consider their savings rates, as the rising cost of living puts the nation's finances under strain. With the majority of savers sitting on low savings rates, switching accounts could see them enjoy greater returns at a time when banks are fighting for their cash."