moneysupermarket.com: competitive fixed rate bonds available

Commenting on the competitive fixed rate bonds available, Kevin Mountford, head of savings at price comparison site moneysupermarket.com, said: "There's a lot of noise in the fixed rate bond market with a wealth of launches and competitive rates topping 6.8 per cent AER - and we can only expect more to come.

"While the current rate environment and last week's base rate cut would suggest customer pricing should start to come down, this has yet to be seen. This week Alliance & Leicester issued a fixed rate bond with a competitive 6.83 per cent AER. Kaupthing Edge and Icesave are still clinging to the top of the best buy table though, with 6.86 per cent, and Heritable Bank is close behind with its new offering of 6.80 per cent as of this weekend, indicating Icelandic banks are still dominating the savings market.
"Competition is as strong as ever as the inter-bank rate gap is getting bigger and bigger. Easy access accounts have featured heavily of late, but those deposits can leave as quickly as they arrive. Fixed rate products, which command a level of consumer commitment and therefore limit providers' exposure to risk, now have very strong one and two year rates.

"I would suggest anyone interested in these bonds moves quickly as no one can predict how long they might last."