Rory McGrellis Staff Photo

Rory McGrellis

Content Writer
Published: 05/07/2024
Making savings | Hand stacking coins

The gap between one- and five-year bonds now stands at 0.30 percentage points.


Rates for leading short-term fixed bonds rose month-on-month, according to data from, widening the gap between their longer-term counterparts.

As of the 1 July 2024, the top one-year bond was at 5.25% while the leading five-year fixed rate stood at 4.95%.

This sees the gap widen from 0.27 percentage points the previous month, when one- and five-year terms paid returns of 5.22% and 4.95% respectively.

The leading two-year deposit also saw an increase, while three-year terms remained steady; four-year bonds meanwhile, observed a decline in top rates.

“The rise and falls of fixed bond rates have been evident over the past couple of years, making it a challenging environment for savers unsure whether to lock their cash into a deal or for how long,” explained Rachel Springall, Finance Expert at

“Just because the top rates move, does not necessarily mean the whole market is moving in a similar trajectory, so savers need to compare deals carefully,” Springall continued.


Is now a good time to commit to a longer term?

Traditionally, the longer you committed to locking away your hard-earned cash, the higher the interest rate you’d receive.

However, this has not been the case for some time, with shorter-term bonds offering significantly better returns as providers factor in the likelihood of a cut to the Bank of England base rate after last month’s announcement.

“There are expectations for interest rates to fall in the coming months and that could impact fixed bond rates, so securing a deal now may be wise,” said Springall.

The Bank of England Base Rate has remained unchanged since August last year and, while not the only factor influencing interest rates, still has an impact on pricing.

If you’re concerned about the effect on the savings market if rates were to drop, now may be a good time to consider accounts with a longer fixed term.


Compare fixed bonds

Our fixed savings charts are updated regularly to show the best rates on the market.

You can also view our weekly savings roundup for more information on accounts offering top rates.

Where to find competitive rates

While some may be cautious when considering unfamiliar brands, lesser-known challenger banks often pay some of the most competitive rates.

Springall explained these providers are motivated to pay the best returns to entice deposits to fund future lending, meaning accounts are often withdrawn when quotas are met.

This can result in fast moving competition as different providers compete for the top spot, creating an urgency to secure the best rates before they’re gone.

Nevertheless, make sure to carefully read all aspects of a deal before committing.

To compare the whole of the fixed market, you can visit our charts to find the best account for your circumstances.


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