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Mervyn King insists UK savers have not been abandoned

The Gov of the Bank of England, Mervyn King, has this evening suggested that UK savers have not been abandoned even though UK base rates have now been slashed to 1%. With more and more UK savings accounts offering 0% interest on deposits there has been a substantial increase in the pressure felt by many who depended upon their interest payments to live. More and more people are now being forced to reduce their "nest eggs" in order to survive and cover their day-to-day expenses.

The Bank of England believe that the ongoing reduction in UK base rates will assist with the long-term aim of reviving the UK economy, at which point rates will be increased and savers will be "back in the money". However, the bank has not as yet given any timescale on such a move to increase interest rates, leaving many UK savers in the lurch.

This is the first such mention of an increase in UK base rates and while Mervyn King's comments are useful, they lack any real substance at the moment. The UK government has not been as forthcoming with more upbeat comments over the last few months as more and more savers stare at the possibility of seeing their savings substantially depleted the longer the UK recession continues.

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