The last time this rate was higher was November 2008.
The average rate for a one year fixed cash ISA hit 5.00% gross today, the highest it’s been since November 2008.
This follows average savings rates rising steadily across the market throughout July as providers price in potential further hikes to the Bank of England base rate. Only last month, average rates for a one and two-year fixed bond breached the 5.00% threshold.
With the Bank of England’s Monetary Policy Committee (MPC) meeting this Thursday to vote on whether there should be a further increase to the base rate, it’s possible savings rates could continue to rise. Therefore, you may want to review your savings in order to ensure you’re still getting competitive returns.
Average savings rates can give people an idea of whether they are getting value for their savings. Not only this, but they can also provide an overview of how the market is performing. If average rates are rising, it may be worth reviewing your savings to ensure your provider is keeping up with market trends.
Graph: Average returns on a one-year fixed ISA are at their highest since November 2008.
The market leading rate for a one year fixed cash ISA currently stands at 5.71% AER, paid by Shawbrook Bank’s 1 Year Fixed Rate Cash ISA Bond Issue 79 and Virgin Money's 1 Year Fixed Rate Cash E-ISA Issue 611. However, high street brands, NatWest and Royal Bank of Scotland, provide highly competitive options with both their 1 Year Fixed Rate ISA Issue 326 accounts coming with a slightly lower rate of 5.70% AER.
Alternatively, supermarket provider, Tesco Bank, offers the third best rate in this field. Its Fixed Rate Cash ISA pays 5.60% AER.
Our ISA roundup is updated every Thursday and provides further details on some of the best rates available. Can’t wait until then? Visit our charts for a complete view of the ISA market.
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