Interest rate rise: Why hasn't my savings rate gone up yet?

The Bank of England today increased interest rates to 0.5 per cent in the first rise for a decade. The new rate reverses a cut made last summer after the EU referendum and still leaves rates at near record lows

Savers have been offered some hope as a wave of providers pledged to boost their rates.

Nationwide, Skipton, Yorkshire and Coventry have all pledged to increase their savings rates by 0.25 percentage points from next month. He said: "Households are generally well positioned for a rate increase".

The Bank of England's indication on Thursday that it will raise Bank Rate twice more by the end of 2020 is not set in stone, one of its top decision-makers said.

"Other banks and building societies, perhaps with a larger and more diverse range of savings products, will take a more considered view and will need internal approval before making an announcement", he says.

According to figures from Moneyfacts.co.uk, savings rates slumped after the base rate was cut from 0.5% to 0.25% in 2016.

In September, the Consumer Prices Index inflation rose to 3 percent - the highest rate since 2012 - but the committee expects it to fall to 2 percent next year.

As well as the low base rate, schemes such as funding for lending have been blamed in recent years for depressing savings rates further, as banks have been less reliant on needing to attract savers' cash with attractive rates.

And he emphasised that despite the significance of the first rise in rates for a decade, a low interest rate environment still prevailed.

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"Some of our savers have accounts which track Bank Base Rate and these will increase by up to 0.25 per cent within the next seven working days".

"Savers have struggled to find a decent return with rates at rock-bottom".

Data comparison since the last rate rise on 5 July 2007 also makes for some interesting reading.

That's only if we have tracker or standard rate mortgages of course. In the United Kingdom fixed-rate mortgages are often limited to one to five years before converting to a standard variable-rate mortgage. Money editor, said: "Almost half of homeowners have never experienced an interest rate hike - raising important questions about how well prepared they are for the impact it could have on their finances".

Bank governor Mark Carney signalled on Thursday that rates were likely to rise twice more over the next three years.

Mr Lewis suggested savers earning less than 1% interest "should ditch and switch".

The rise in rates will also impact savings accounts, with better deals expected.

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