As of July 2026, savings rates have risen from their February 2026 lows, driven partly by shifting inflation expectations following geopolitical developments in early 2026. Following six base rate cuts since August 2024, easy-access rates had retreated to around 4.55% by February 2026. But as of 2 July 2026, the highest easy-access savings rate is 5.00% AER (inclusive of bonuses). While this remains significantly higher than the 0.7% seen in 2021, the medium-term trend remains uncertain as the Bank of England base rate holds at 3.75%.

One sign that market expectations have shifted is that the average one-year fixed savings rate has risen from 3.79% at the start of March 2026 to 4.22% by June 2026, reversing the earlier downward trend.

How have savings rates moved over the past 12 months?

Average savings rates fell through late 2024 and into early 2026 in step with the base rate, which stands at 3.75%. Average easy-access rates rose from 2.42% at the start of March to 2.49% at the start of May 2026, while the average one-year fixed rate rose from 3.79% to 4.07% over the same period, according to Moneyfacts data. These averages are considerably lower than the top-of-market rates available to savers who actively compare and switch.

Why have savings rates fallen this year?

As you can see in the chart below, savings rates unequivocally peaked in the summer of 2024 and have been on a slow but steady general decline ever since.

Interestingly, inflation (as marked by the CPI) peaked around two years earlier, in 2022/2023. Recent data from January 2026 shows inflation (the purple line, below) is now at 3.0%, a significant drop from the double-digit peaks of 2023 but slightly above the Bank's 2% target. Consequently, the Bank of England has unwound much of its previous tightening, bringing the base rate (in yellow in the chart) down from 5.25% to 3.75%.

While inflation was bad for those holding cash, the consolation for savers was that high inflation also put pressure on the Bank of England to raise interest rates. The UK's central bank hiked its base rate (a.k.a interest rates) on more than a dozen occasions since the peak in inflation.

While not directly linked to savings rates, the Bank of England's base rate has a massive impact on the savings market. That's because the base rate is the rate at which banks can lend to each other. So when interest rates rise this can hot up the competition for saver's cash.

Have savings rates already peaked?

The picture is now less clear than it appeared in early 2026. The Bank of England held rates at 3.75% at its June 2026 meeting. The changed outlook, driven in part by concerns that geopolitical disruption to global oil and gas supplies could push up inflation, appears to have encouraged savings providers to increase rates and offer more competitive returns. Whether rates will rise further or resume their decline depends on inflation data and upcoming MPC decisions, with the next rate decision due 30 July 2026.

What should savers do?

As of 2 July 2026, the highest easy-access savings rate is 5.00% AER (inclusive of bonuses), according to Moneyfactscompare.co.uk's market-wide comparison, which is updated hourly. Note that the leading easy-access rates include short-term bonus rates that revert to a lower standard rate after six to twelve months. Always check the underlying rate before committing.

For those willing to lock money away, the top one-year fixed rates sit in the 4.6% to 4.8% AER as of July 2026, with the average one-year fixed rate around ~4.2%. For higher returns on monthly contributions, some regular savings accounts currently pay up to 8.00% AER, though monthly deposit caps and eligibility conditions apply.

There's lots of movement in the savings market right now. To explore more options, and to see the latest accounts available, take a look at our best savings accounts guide.

All accounts above have FSCS savings safety protection. Rates sourced from Moneyfactscompare.co.uk, correct as of 2 July 2026. Rates are variable and subject to change at any time. This comparison covers publicly available savings accounts across the UK market. Always verify current rates directly with providers before opening an account.