NS&I interest rate reductions

NS&I (National Savings and Investments) will be decreasing the interest rates on a range of its fixed rate savings offers by up to 0.50% per annum on 23 January 2008.

This change follows significant decreases in the returns on gilt yields since NS& I last reduced interest rates on some of its fixed interest offers on 28 November 2007.

The rate changes will affect new investments, only in; Fixed Interest Savings Certificates, Fixed Rate Savings Bonds, Children's Bonus Bonds, Capital Bonds and Pensioners Guaranteed Income Bonds.

How NS& I prices products

NS& I prices its fixed rate products according to a number of factors, the principal factor being the return on gilts. Because the return on nominal gilts has fallen significantly since its last rate change, largely due to the instability in the credit and sub-prime mortgage markets, NS& I will now offer lower rates on most of its fixed rate products.

There will be no change to NS& I's variable rate products which are priced in relation to the Bank of England base rate, and last decreased as a result of the base rate change on 6 December 2007.