Easy Access rates going up

MeadowsVale

Why is it when the BoE announce a rate cut all the savings providers more of less cut their rates straight away. But when the BoE holds the rate for a few months, these savings providers start putting their rates up again. Why is this?

I've just dropped a lump into Cahoot at the weekend @ 4.52 and I've noticed quite a few others hovering around the same rate.

gt94sss2

Because they think the next change in the Bank of England base rate might be an increase

masonic

The job of a savings provider is to attract sufficient money to meet their lending aspirations at the lowest rate possible. If they cannot maintain enough money at their existing rate, then they will offer a better rate to pull in more. Conversely, if they find or predict they will be pulling in too much money to lend out, then they will drop their rate.

wmb194

Whilst Bank rate is an important benchmark ultimately it's the market that determines the price of money. For banks and BS' the price of mortgage swap rates is very important in determining the rates they pay for deposits. At the moment it looks like it's c.4.15% for a two year swap vs the Bank rate of 3.75%.

Short dated gilts are >4%.

https://easfinance.co.uk/uk-swap-rate-monitor/

https://giltsyield.com/bond/

https://www.bankofengland.co.uk

Albermarle

As above- it could be more related to how busy the lending side of their operations are currently.

Also there seems to be a steady stream of new players, who have to offer good rates, initially at least, so that could effect the strategy of more established providers.