Interest rates rise to 13-year high – but savers 'won't see any benefits'

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The Bank’s Monetary Policy Committee (MPC) has announced a 0.25 percent increase from 0.75 percent to one percent. The base rate, which lenders use as a benchmark for interest rates, is now at a 13-year high of one percent.

This is the fourth increase since December and comes amid the rising cost of living, and soaring inflation.

However savers have been warned they “won’t see any benefits” as inflation is currently locked in at seven percent, and is only predicted to keep increasing.

Kevin Brown, savings specialist at Scottish Friendly, said: “For those who are saving, cash is still a terrible place to be with locked in real losses, even if savings account rates are ticking up in step with the BoE.’

“Celebrating savings interest rates going up to one percent while the real value of your cash is being decayed by eight percent inflation is like being sold a car with no wheels and then getting charged for not driving it out of the forecourt – it’s just an insult to savers and hard working families.”



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