Some average fixed Isa rates on the market have increased to the highest level since 2024, in a “welcome boost” for savers, according to a financial information website.
Moneyfacts said the average one-year fixed Isa rate was 4.26% at the start of September, marking the highest level since September 2024, when it was 4.29%.
The average longer-term fixed Isa rate rose to 4.30%, its highest since January 2024, when it was 4.32%.
Longer-term Isas were defined by Moneyfacts as those with terms of more than 550 days.
Moneyfacts analysed average interest rates based on a £5,000 deposit at the start of each month.
Caitlyn Eastell, a personal finance analyst at Moneyfacts, said: “Savers have been handed another welcome boost this month, with fixed savings rates continuing to climb and competition remaining incredibly strong across the market.
“This continued upward movement is positive news for savers who are looking to secure a guaranteed return, particularly those who have been waiting to see if rates could climb even higher.
“It also means that savers who locked away their cash some time ago could now find significantly more competitive options available.”
Isabella Galliers-Pratt, a senior investment director at Rathbones, said: “The return of more competitive Isa rates will be welcome news for savers.
“However, while cash plays an important role in providing security and funding short-term goals, it is not without risk.
“Inflation remains above the Bank of England’s 2% target, meaning cash savings can still lose purchasing power over time, particularly if inflation proves more persistent due to factors such as higher energy prices.
“For those with a time horizon of five years or more, investing can offer the potential for higher, inflation-beating returns over the long term.”
The value of investments can go down as well as up and people’s risk appetites and individual circumstances will vary.
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