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Interest rate cuts see savings rate cuts
29 February 2008
While the cut in interest rates from 0.25 per cent to 5.25 per cent was good news for people with debt, people who were focused on saving will be less pleased with the cut.
As the base rate goes down, so do the rates on tracker mortgages and often, though seemingly not this time, so do the rates on initial deals.
This is a benefit to people making repayments, but people with savings in the bank will see them accrue interest more slowly.
Alliance and Leicester announced today a series of changes it will implement on its savings accounts which range from no change at all on its eSaver account to a .50 per cent drop in the rates for a Instant Access account with more than £25,000 in it.
The changes will become effective on Monday March 3rd.
Earlier in the month Liverpool Victoria (LV=) announced that the Easy Cash ISA rate would be reduced by 0.50 per cent , while the Easy Access savings account would come down by 0.25 per cent.
