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When will UK savings rates return to former levels?

With UK base rates currently at a 0.5% and the vast majority of savings accounts offering limited interest on deposits, savers in the UK are starting to wonder as and when savings rates will return to former levels. It is easy to forget, in the midst of the current recession, that UK base rates were around 5% less than two years ago and have fallen by 90% in the meantime. Unfortunately, even though we have seen a number savings account offers hit the market over the last few days there will be no general increase in rates until base rates start to move, something which still appears to be some way off.

The sad truth is that UK savers are most certainly the bottom of the list with regards to the UK government and the UK banking industry and will be the last to see their income increase. A number of observers have accused the UK banking industry of "milking" the current situation by increasing mortgage and loan rates while base rates remain at record lows thereby increasing their profit margins. There is an argument that finance in the money markets has become more expensive of late but whether this is true or not, there is no doubt that savers in the UK will be the last to realise that the UK recession is over.

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