The Lemon Fool

I keep a track of these.

These were the rates in early March 2020 when the BOE interest rate was 0.75%. The markets hadn't appreciably noticed Covid at that point. Even at this point as someone retired and living off my investments I was very unhappy about how low the rates were
Instant access 1.31%
1 yr bond 1.55%
2 yr bond 1.7%
3 yr bond 1.8%
5 yr bond 1.9%

By the end of March 2020 the BOE had cut rates twice to 0.1% and from there rates fell and fell hitting the low in April 2021. The rates were then:
Instant access 0.5%
1 yr bond 0.6%
2 yr bond 0.7%
3 yr bond 0.9%
5 yr bond 1.3%

Rates have been picking up since then and are now:
Instant access 0.5%
1 yr bond 1.1%
2 yr bond 1.25%
3 yr bond 1.36%
5 yr bond 1.7%

It's interesting that there were many posts on this topic as rates fell but almost none as they have been rising.

It's also interesting that whilst these rates have been going up corporate bond yields have been falling suggesting the challenger banks who offer the best rates require cash but the large corporates who access cash from pension funds and institutions etc are awash with cash and the difference is not being abritraged. Different companies with different objectives I guess.

I hope the rates continue to rise.

Gan020 wrote:I hope the rates continue to rise.

That’s only any good if they rise faster than inflation - which they won’t.

The trouble with rising interest rates is that they can induce paralysis (unless you are looking at easy access accounts). Is it worth tying my money up for 12 months for an extra 0.6% if interest rates are likely to rise in the near future? I certainly don't fancy tying it up for an extra 4 years to bag an extra 0.6%. This is a problem as I keep having previously set up 5 year fixed rate accounts maturing.

Rates moving up nearly daily in the less than 5 year zone. Tandem and Zopa seem to be competing to be at the top. They clearly want our cash.

Instant access 0.58%
1 yr bond 1.11%
2 yr bond 1.36%
3 yr bond 1.44%
5 yr bond 1.7%

Only a week since my last post and rates still moving up fast. It's not yet reached the point where the gap between instant access and a 2 year term is enough to entice, but it's got to the point I'm bothered to work out the maths

Instant access 0.65%
1 yr bond 1.22%
2 yr bond 1.41%
3 yr bond 1.5%
5 yr bond 1.7%

1 week since last post. Rates still moving up nicely

Instant access 0.65%
1 yr bond 1.31%
2 yr bond 1.46%
3 yr bond 1.55%
5 yr bond 1.72%

but still way below the rate of inflation
A tracker fund will give you a much better return (IMHO)

Instant access 0.65%
1 yr bond 1.41% up 0.1% this week
2 yr bond 1.67% up 0.21% this week
3 yr bond 1.76% up 0.21% this week
5 yr bond 1.81% up 0.09% this week

It seems some of the challenger banks are desperate for cash as the economy reopens.

This weeks rates

Instant access 0.65% no movement
1 yr bond 1.5% up 0.09% this week
2 yr bond 1.75% up 0.08% this week
3 yr bond 1.77% up 0.01% this week
5 yr bond 1.86% up 0.05% this week

At present I have little cash on instant access apart from NSandI which pays me around 0.9% if I assume I never win one of the bigger prizes.

The two year bond rate is now enough to make me consider if locking up my money for 2 years for an additional 0.85% is worth it. Can't make my mind up.

As you seen keen on cash savings rates (as opposed to a tracker fund or shares, which I understand are not for everyone)
try Atom Bank 2 year 1.75
https://www.atombank.co.uk/fixed-saver/
You have to set it up on your phone
(I did a few years ago and had my account ready to go, but they they cut their rate just befoe I was abopuit to deposit with them so I put it into shares instead)

Upward movement in rates starting to slow down after a large move over the last couple of months.

Instant access 0.65% no movement
1 yr bond 1.5% no movement
2 yr bond 1.76% up 0.01% this week
3 yr bond 1.81% up 0.04% this week
5 yr bond 1.86% no movement