What about the savers?
With revelations that the Bank of England had even considered a sharper reduction in interest rates than the recent 1.5% cut has injected horror and disgust into the savers market where rates tend to move an awful lot quicker than those in the mortgage market. Despite a number of mortgage providers suggesting they will not move their rates until early to mid December, the vast majority of savings accounts have already seen their interest rates fall in line with the reduction in base rates.
Despite all of the doom and gloom about the economy and the ever growing debt mountain for many in the UK there are still an awful lot of people who depend on their savings and interest which they earn from these accounts. The likelihood is that UK base rates will fall even further before the end of 2008 and possibly into 2009, something which will decimate the income from those who depend on their savings. In the event of a full-blown depression there is even speculation that rates may fall to around 0% which would leave savers with literally no income.
It is interesting to see that the government has totally ignored the savings market and even the National savings accounts do not offer the same value for money as they used to.
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