Interest rate frenzy in fixed rate savings market

Andrew Hagger, Head of News and Press at Moneyfacts.co.uk, comments on the increase in retail savings rates: “Moneyfacts has today witnessed a surge in interest rates for fixed term savings accounts, a scenario that financial analysts have been expecting over the last couple of weeks.

“It is unusual to see rate rises that are not triggered by increases in base rate; however with money markets in a volatile state on the back of the US sub-prime mortgage crisis, it is not surprising to see savings rates being increased, in an attempt to bring funds in via their front doors, rather than resorting to traditional methods.

“With rates being increased by up to 0.55% in some cases, it is an excellent opportunity for savers to bag themselves a great fixed rate savings deal, as institutions battle to bring in additional funds to help them during these difficult times.”