The average easy access rate has breached 3% for the first time in almost 15 years but the longer-term fixed bond market has recorded a fall for the first time in six months.
All variable savings rates in the easy access, notice and ISA product ranges have now risen 20 times in a row, which is the first time on record, according to Moneyfacts which has collated the data since 2007.
The average easy access rate in October 2023 now stands at 3.16%, up from 2.95% in September – marking the first time it has breached 3% since November 2008.
Meanwhile, the average notice account rate rose to 4.15% from 4.04% a month earlier. According to Moneyfacts, this is the highest it’s been since January 2008 (4.22%).
Now, while savers continue to benefit as average one-year bonds have risen to 5.42% – the highest point in 15 years – the average longer-term fixed bond (550+ days) actually fell back from 5.12% to 5.11% in the month. This is the first decline since March 2023.
But when it comes to ISAs and tax-free savings, Moneyfacts revealed the one-year deals have risen from 5.19% to 5.27%, another near 15-year high. However, rates on longer-term fixed ISAs remained unchanged at 5.02%.
Product choice increased on the month, with savers able to view 1,979 deals, including 529 ISAs which is the second highest count on the firm’s record.
Savers may need to go quick
Rachel Springall, finance expert at Moneyfacts, said the decline in the longer-term fixed bonds “signals a turnaround for the market”, which is perhaps not too unexpected as the base rate was frozen in September and is expected to drop in the months ahead.
“Those savers considering a fixed bond or ISA may wish to act quickly to take advantage of the highest rates”, Springall said.
For those using ISAs, particularly older subscriptions, Springall urged savers to transfer funds rather than encash them to keep their tax-free ISA wrappers.
And she added that savers “would be wise” to look for ISAs that apply flexible ISA rules if they need to dip into their pot and top up their ISA during the same tax year.
“Those who make use of their Personal Savings Allowance (PSA) must not forget about their yearly ISA allowance and consider them for their long-term tax-free benefits, particularly as interest rates have been on the rise,” she said.