Despite the Chancellor’s reminder to the Bank of England to keep inflation down, yesterday’s Monetary Policy Committee (MPC) meeting settled on the decision to halt a rise on the base rate – leaving an otherwise convinced market somewhat off-balance.
With inflation forecasted to surge to 5% in spring and pressure mounting, the MPC said it was likely that rates would increase from 0.1% “over the coming months”.
What does it mean for cash savers?
Although not much can be said in the way of help for savers right now, it is widely anticipated that the rate will rise before the end of the year, with a further increase in 2022 to 1%. Should this transpire, investors will need to act quickly and efficiently on changing rates in order to maximise their returns. Find out how you can manage your cash portfolio at speed by speaking to us today.
But a lacking rate rise doesn’t mean savers should sit tight. While the wait for a hike continues, those with cash assets should be proactive and take advantage of the best rates in the market. By consistently moving funds into accounts that pay market-leading rates, businesses alone can collectively avoid missing out on £3.2bn in returns.
In a perfect storm for savers, the Office for National Statistics has announced that the cost of goods and services has continued to increase in October, which will deepen the pressure to hike the Bank rate sooner rather than later.
Flagstone insights drawn from previous base rate activity shows that an increase to 1% next year will have a considerable effect on the savings market. In preparation, savers should look to actively manage their cash ahead of expected rate rises.
As with so much in today’s world, technology holds the key. Flagstone’s award-winning online cash deposit platform provides you with a simple, secure solution – empowering you to monitor rates and open multiple accounts in just a matter of clicks. Chat to us today to learn more.