Saving Tales of the Unexpected

cricidmuslibale

The savings market (along with the mortgage market) is unsurprisingly very volatile right now, that’s all too obvious!  That being said, here are some things that I really did not expect right now:

1) The B of E stating yesterday that it will not enact any further rise in interest rates until its next scheduled meeting in early November!

2) NS&I yet to announce interest rate rises on their Direct ISA, Direct Saver and Income Bonds accounts, all of which are currently offering c 0.75% less than equivalent savings products elsewhere (and this gap is likely to grow further quite quickly as things stand at present).

3) Virgin Money yet to increase the 2.02 AER monthly interest rate on its M Plus current account (for amounts up to £1000) and also not having increased the 1.71% AER quarterly interest rate on its linked M Plus saver in response to the recent base rate rise of 0.5% especially!

4) Yorkshire Building Society to be the first mainstream savings provider to offer something close to easy access savings (more so for ‘loyal’ customers) at a variable 2.5% interest rate.

5) HSBC still yet to increase the fixed interest rate on its regular saver from the now dismal 1.0% to something close to its relative First Direct’s 3.5%!

That’s more than enough from me for now. All thoughts, comments etc welcome!

[Deleted User]

With regard to Virgin I may be wrong but did they not last increase rates just before the previous rate rise, the one before last weeks? I'm hoping for Nationwide to join the rate raising party but I won't be holding my breathe.

Albermarle

cricidmuslibale said:

The savings market (along with the mortgage market) is unsurprisingly very volatile right now, that’s all too obvious!  That being said, here are some things that I really did not expect right now:

1) The B of E stating yesterday that it will not enact any further rise in interest rates until its next scheduled meeting in early November!

2) NS&I yet to announce interest rate rises on their Direct ISA, Direct Saver, Income Bonds and Premium Bonds accounts, the first three of which are currently offering c 0.75% less than equivalent savings products elsewhere.

3) Virgin Money yet to increase the 2.02 AER monthly interest rate on its M Plus current account (for amounts up to £1000) and also not having increased the 1.71% AER quarterly interest rate on its linked M Plus saver in response to the recent base rate rise of 0.5% especially!

4) Yorkshire Building Society to be the first mainstream savings provider to offer something close to easy access savings (more so for ‘loyal’ customers) at a variable 2.5% interest rate.

5) HSBC still yet to increase the fixed interest rate on its regular saver from the now dismal 1.0% to something close to its relative First Direct’s 3.5%!

That’s more than enough from me for now. All thoughts, comments etc welcome!

Even these increases rates are far from keeping up with inflation, so they only mean you lose a bit less in real terms. 

RG2015

The savings market (along with the mortgage market) is unsurprisingly very volatile right now.

It is the same for customers and financial organisations alike.

Bankers may be viewed as bonus grabbing, fat cats but they are also people like us with a job to do. They have a duty to their shareholders to run their businesses effectively and profitably.

They have some difficult decisions to make and I guess that like us haven't got a crystal ball. They may be waiting to see what happens before making changes. Or maybe they will speculate based upon their predictions.

Eventually they will make their decisions in the best interests of their companies. That may mean increasing savings rates or not. If they get this wrong they will either lose customers or lose money.

This sounds a bit like supply and demand economics. 

InvesterJones

cricidmuslibale said:

The savings market (along with the mortgage market) is unsurprisingly very volatile right now, that’s all too obvious!  That being said, here are some things that I really did not expect right now:

1) The B of E stating yesterday that it will not enact any further rise in interest rates until its next scheduled meeting in early November!

2) NS&I yet to announce interest rate rises on their Direct ISA, Direct Saver, Income Bonds and Premium Bonds accounts, the first three of which are currently offering c 0.75% less than equivalent savings products elsewhere.

3) Virgin Money yet to increase the 2.02 AER monthly interest rate on its M Plus current account (for amounts up to £1000) and also not having increased the 1.71% AER quarterly interest rate on its linked M Plus saver in response to the recent base rate rise of 0.5% especially!

4) Yorkshire Building Society to be the first mainstream savings provider to offer something close to easy access savings (more so for ‘loyal’ customers) at a variable 2.5% interest rate.

5) HSBC still yet to increase the fixed interest rate on its regular saver from the now dismal 1.0% to something close to its relative First Direct’s 3.5%!

That’s more than enough from me for now. All thoughts, comments etc welcome!

1: BoE non-action. This isn't a huge surprise - they will have argued that an extra-ordinary rate increase was a sign of panic/weakness, and, well, Mr Bailey. I'm sure the regular conversations they have with the new government and threats to revoke independence have nothing to do with it.

2-5: Organisations generally not increasing their rates to match the BoE rate. Also nothing new, they're not obliged to, they'll only increase as much as needed for competitive (or not too competitive in NS&I's case) concerns.

cricidmuslibale

Well, thanks to today’s significant improvement in the Premium Bond prize interest rate plus considerable increase in £50 and £100 prizes especially, my point 2) above will now have to be edited.

Thank you very much to all who have commented above up to now!