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Bank of England base rate decision "irrelevant" as more than 70% of savings providers have cut rates already in 2026

ended 05. February 2026

Since the start of 2026, more than 70% of savings providers have cut rates, according to Moneyfactscompare.co.uk analysis.

It claims that today's Bank of England base rate decision is “irrelevant” because the hold has already been baked into the market.

Since the start of 2026, more than two thirds (70%) of savings providers have cut their rates, considering both variable and fixed rates (1 January – 2 February 2026).

Year-on-year average rates across easy access and notice accounts have fallen, with the average easy access rate down from 2.92% to 2.42%, and the average easy access ISA rate down from 3.06% to 2.60%. The average notice account has fallen from 4.00% to 3.37% and the average notice ISA rate has fallen from 3.92% to 3.23%.

The Moneyfacts Average Savings Rate has fallen over the past 12 months to 3.31%, its lowest point since May 2023 (3.20%). The rate was last above 4% in January 2024 (4.04%). This means, overall, savers are losing money in real terms as inflation is higher.

  • What is your reaction to the data showing savings accounts are on a downward trajectory, even below inflation.
  • What should savers do?
  • Do you think the Bank of England will hold as expected? If so, is the hold already priced in to savings rates etc?

Responses asap please.

4 responses from the Newspage community

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Editor
Chris Barry
Director at Thomas Legal
The Bank of England will hold interest rates today which is a welcome sign of stability and continuity in the market. Interest rates across many lending products have reduced so far this year and savings products are following suit. Savers should consider turning to investment products for their long term saving options as many ETP’s have outperformed rates offered by highstreet banks and building societies
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Philly Ponniah
Chartered Wealth Manager and Financial Coach at Philly Financial
This data confirms what savers are already feeling. Cash rates are sliding and inflation is eating away at balances, even for people doing what they are told and shopping around. When the average easy access rate sits below inflation, cash stops being a safe place to grow money and becomes a parking space for short term needs.

For savers, the key is intention. Keep enough cash for emergencies and known spending, but stop expecting savings accounts to provide any growth long term. Anyone with surplus cash should be looking at fixing for certainty, using tax wrappers like ISAs properly, or accepting some investment risk if the money is not needed for several years. Holding everything in easy access out of habit is now a guaranteed way to fall behind in real terms.

On the base rate, a hold from the Bank of England looks very likely, but it genuinely does not matter for savers. The market has priced this in already. As Moneyfactscompare.co.uk points out, providers have moved early.
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Editor
Samuel Mather-Holgate
Managing Director & IFA at Mather and Murray Financial
The Bank is holding rates today, Bailey is cautious and the inflation data isn’t great. Rather than the decision, the markets will want to see the commentary that comes along side it as, for some reason, the Bank of England still has some credibility with the markets. The economy is in the bin, and even stubborn inflation shouldn’t distract the bankers from lowering rates.
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Kundan Bhaduri
Entrepreneur, Investor and Landlord at The Kushman Group
The tragedy is that the Base Rate is becoming a lagging indicator. The swap markets, the wholesale cost of money, are driving the bus, and they have decided that the UK economy is too fragile to sustain these rates, regardless of the Bank rate.

My advice is if you are sitting on cash in a variable account waiting for the BoE to ring the bell, you are losing money every day. Fix at the earliest with the best rate currently on the market.