Holding off investing in fixed terms?

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81935145#Comment_81935145

Thread from ISA forum.

Moneybox Cash ISA rate for transfers in — MoneySavingExpert Forum

efunc

https://forums.moneysavingexpert.com/discussion/comment/81935172#Comment_81935172

Thanks for that. So the top current 1yr Fixed ISA is paying 4.36% and the Moneybox variable rate is 4.25%.

Obviously no one can predict the future but if we're heading into inflation or stagflation there may be a couple of 0.25% increases this year. But are they generally passed in full to savers? Or do Moneybox delay or only partially pass on the increases, and at what point in the 12 months? It still seems that there isn't a compelling argument each way

Enzo_L

For what it is worth I'm not doing anything financial that I can't get out of again at the moment.

I know that there are always "events" but the atmosphere is so febrile at present, and future events, and more especially people's reactions to any events, are so unpredictable that I wouldn't want to go into anything fixed or that I couldn't change for a specific period of time.

I don't think the rewards offered for fixing at present compensate for the risk.

Of course I can't predict the future but I do sleep soundly at night.

masonic

https://forums.moneysavingexpert.com/discussion/comment/81935433#Comment_81935433

Fixed rates already anticipate the future, but are more tied to mortgages and other bank lending, where the money is used. But estimates of future borrowing costs, influenced by predictions of base rate, can be underestimated.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81935433#Comment_81935433

Savings providers also have targets for bringing in new money/new customers. Once those targets are met they sometimes let rates drift down, or up if they are looking for more business. It is not just about passing on BoE rates .

asus1987

https://forums.moneysavingexpert.com/discussion/comment/81935433#Comment_81935433

Castle, West brom, Seem to allow trasnfers in at the same rate, 1 year fixes etc

efunc

Those West brom rates are a bit screwy! 1 year and 2 year Fixed rate ISAs at 3.5%, but the 18 month at 4.45%! OK…

EthicsGradient

https://forums.moneysavingexpert.com/discussion/comment/81936100#Comment_81936100

And then back up to 4.4% for a 3 year one (non-ISA fixed rates are the same for those periods). Either they have some particular funding goals for certain periods, or they are predicted wild changes in the day-to-day interest rates over the period …

Rich2808

https://forums.moneysavingexpert.com/discussion/comment/81935546#Comment_81935546

In the unlikely event there is a wider collapse in the banking system it wouldn't make much difference if you are in an instant access or fixed rate isa surely! Technically it is about the institution having the funds - not the slight delay from closing the latter.

Not as if I can go down to my local building society and demand £15,000 in five and ten pound notes anyway!

SloughSally

https://forums.moneysavingexpert.com/discussion/comment/81935657#Comment_81935657

Less than 4 weeks ago the gilt market was predicting 2 interest rate drops of 25 points by the end of the year, now they are predicting 4 25 point rises in the same timeframe, a swing of 1.5%. Yet most banks etc have not changed the rate of their fixed term bonds.