Fixed rate war hots up

Rachel Thrussell, Head of Savings at Moneyfacts.co.uk, comments: "Savers are one of the few groups to have benefitted from the credit crunch, with rates at some of the highest levels that we have seen in recent years.

"With rates on fixed rate bonds continuing to increase, for the first time in many years we have seen all of the top six Moneyfacts.co.uk best buy places being taken up by rates of over 7%.

"Fixed rate investments are not suitable for everyone, but for anyone who doesn't need access to their money for a period of between six months and five years, then rates as high as 7.10% can be found.

"With the banks and building societies struggling to raise money on the money markets, tempting savers has become increasingly important. With fixed rate investments, the institutions can guarantee that they will have your money for a set period of time, which they can then use for lending on mortgages or personal loans.

"With the credit crunch showing now signs of abating, who knows just how high these rates could go?"