After holding at a peak of 5.25% throughout late 2024, the Bank of England has entered a period of steady rate cuts. As of July 2026, the base rate stands at 3.75% following a 0.25% reduction in December 2025. The base rate can have a big impact on savings rates, as rates typically become more generous as borrowing costs increase.

While savings rates are no longer 'rocketing' from their historical lows, they remain at some of their most competitive levels in over a decade, though market leaders have begun to trim their offers in anticipation of further cuts.

For those with some savings, let's explore the current market-leading easy-access and fixed accounts.

How does the base rate impact savings rates?

The base rate is the rate at which the Bank of England lends to commercial banks, and it has a significant influence on the interest rates those banks offer to savers and borrowers.

After more than a decade of historically low rates, the Bank of England raised the base rate fourteen times between December 2021 and August 2023, taking it from 0.1% to a peak of 5.25%. This drove savings rates to their highest levels in many years. Since August 2024, the Bank has cut rates several times, bringing the base rate to its current level of 3.75% as of July 2026.

When the base rate rises, borrowing typically becomes more expensive, affecting mortgage rates, loans, and other forms of credit. Savings rates generally move in the same direction, though the relationship is not always immediate or proportional. Banks and building societies have historically been quicker to pass on base rate rises to borrowers than to savers, and quicker to pass on cuts to savers than to borrowers.

As a result, the best savings rates available on the market do not always move in exact lockstep with base rate changes. When the base rate falls, it is worth reviewing existing savings accounts to ensure the rate remains competitive, as providers may reduce rates without proactive notification.

What are the highest savings rates right now?

If you're a saver, it's a good time to sort your money as rates are rising across the board.

Easy-access savings

As of 2 July 2026, one of the highest easy-access savings rates is ~5.00% AER, which is being offered by Revolut and LemFi (note: both are inclusive of short-term bonus rates). Other competitive options include Tembo Money at 4.55% AER and Chase at 4.50% AER, both also inclusive of bonuses.

It is worth noting that many of the top easy-access rates include introductory bonuses that revert to a lower standard rate after six to twelve months. Always check the underlying rate before committing, and review your account regularly to ensure it remains competitive.

Rates sourced from Moneyfactscompare.co.uk, correct as of 2 July 2026. Rates are variable and subject to change at any time.

Fixed savings

Fixed-rate bonds continue to offer competitive guaranteed returns. The best one-year fixed rate accounts are currently paying around 4.6% to 4.8% AER, with the market average for one-year fixed rates at approximately 4.22% AER as of June 2026 according to Moneyfactscompare.co.uk. Longer-term fixes are paying slightly less on average, at around 4.30% to 4.50% AER for two to five year terms, reflecting uncertainty about the longer-term rate environment.

Unlike easy-access accounts, fixed-rate bonds do not allow withdrawals before the end of the term, or impose significant penalties if they do. The longer the term, the greater the commitment — this is worth weighing carefully against the rate on offer.

Rates sourced from Moneyfactscompare.co.uk, correct as of 2 July 2026. Fixed rates are guaranteed for the term stated. Always check the full terms, including early access penalties, before applying.

Important: All mainstream UK savings accounts from banks and building societies are protected up to £120,000 per person under the Financial Services Compensation Scheme (FSCS). Some e-money accounts use safeguarding rather than FSCS protection — check the terms of your specific account.

Will savings rates rise?

The Bank of England's Monetary Policy Committee (MPC) sets the base rate eight times a year, based on its assessment of inflation, GDP, and other economic indicators.

The base rate currently stands at 3.75%, following the MPC's decision to hold at its June 2026 meeting, by a vote of 7–2. The Bank cited the risk that higher energy prices, linked to Middle East tensions, could push inflation higher in the second half of 2026 as a reason for holding rather than cutting further.

CPI inflation stood at 2.8% in May 2026, above the Bank's 2% target. The next ONS inflation figures (for June 2026) are due on 16 July 2026. The next MPC interest rate decision is scheduled for 30 July 2026.

For more savings tips, and an updated list of the top accounts, take a look at our best savings accounts guide. And with rising rates, be aware of going over the Personal Savings Allowance, which you can read about here.