Moneyfacts UK Savings Trends Treasury Report data, yet to be published, highlights that all of the banking groups have cut rates in 2016’s race to the bottom.

Charlotte Nelson, Finance Expert at Moneyfacts, said:

“Looking back over 2016, you can see the devastation of the savings market in full focus, with some providers seeing their average no notice rate cut by as much as 0.62%. This year was filled with uncertainty, which coupled with the base rate falling to a record low has seen rate cuts outweigh increases every month of the year.

“The majority of the main banking groups’ average one-year fixed rate bonds now pay less than the overall average (0.93%). Unfortunately, this will come as no shock to savers, who have experienced a new low each month this year.

“Despite the Bank of England cutting base rate in August, these providers are still cutting their rates. This proves that these institutions simply do not need savers’ funds, and until these providers start to want the extra cash, the state of the savings market is unlikely to improve.

“Next year is likely to be a struggle for savers, as the Term Funding Scheme will be in full swing, meaning these low rates will likely be here to stay. Couple this with the predicted higher inflation and savers will find it difficult to get a real return on their savings. Even with the NS&I bond launching in the Spring, savers will need to work hard to achieve the best possible rates.”

The Moneyfacts UK Savings Trends Treasury Report, out later this month, is a comprehensive monthly overview of current and historical data for the savings market, incorporating written commentary alongside graphs and tables highlighting key trends.

www.moneyfacts.co.uk - The Money Search Engine

Moneyfacts.co.uk is the UK's leading independent provider of personal finance information. For the last 20 years, Moneyfacts' information has been the key driver behind many personal finance decisions, from the Treasury to the high street.

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