Last Thursday (6 February) the Bank of England cut interest rates from 4.75 per cent to 4.5 per cent.
Whether you should get a cash ISA - and the alternatives that could be better
Read MoreThere are more cuts to come, with Barclays announcing on Tuesday that it would cut rates on two of its accounts later this week.
Leeds Building Society and Skipton Building Society are among others reducing their rates.
Experts are urging savers to shop around for the best rates.
“A handful of providers are offering easy access savings accounts with rates of more than 4 per cent, meaning you can earn money, and make withdrawals when you like.”
The Bank of England said last week it expects inflation to reach 3.7 per cent by the middle of next year. With rates falling down and inflation increasing, if savers are on deals below or near inflation when it rises, their real rate of return will be minimal.
Currently, the best deal is with Trading212 on its cash ISA which is offering 5.03 per cent.
Returns on savings tend to fall as the base rate does. The last time the base rate was cut – November 2024 – average savings rates on accounts dropped too.
Mortgage rates falling too
Those on variable mortgages see immediate reductions, but fixed mortgage prices are starting to drop a little too.
NatWest has become the latest big provider to announce that it is cutting fixed rates.
MPowered has also made cuts to its fixed-rate mortgage range, with two-year fixes now starting at 4.34 per cent for those with 40 per cent deposit or equity with a £999 fee, or 4.59 per cent with no fee.
Some of the best deals can be seen below.
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