NS&I bumps up some savings rates to 0.35%
NS&I is to increase interest rates on its Direct ISA, Direct Saver and Income Bonds to 0.35% from 29 December following the recent Bank of England base rate rise.
The interest rate on Direct Saver and Income Bonds will be increased by 20 basis points, from 0.15% gross/AER to 0.35% gross/AER.
The interest rate on the NS&I Direct ISA will be increased by 25 basis points, from 0.10% tax-free/AER to 0.35% tax-free/AER.
Last week the Bank of England increased its base rate from 0.10% to 0.25%, the first rise in rates for three years.
The move came after CPI inflation rose to 5.1% in November - the highest level for over 10 years.
The rise in inflation has put pressure on the bank to keep inflation under control. Inflation is well above the Bank's 2% target for CPI.
NS&I’s says its Net Financing target for 2021-2022 will be £6bn and in a range of £3bn to £9bn.
In October this year, NS&I published its year-to-date total Net Financing performance of £0.6bn.
NS&I says the decision to increase the interest rates on the products is in order to help NS&I meet its annual Net Financing target.
Product |
Current interest rate |
Interest rate from 29 December 2021 (change in brackets)
|
Direct ISA |
0.10% tax-free/AER |
0.35% tax-free/AER (+25 basis points) |
Direct Saver |
0.15% gross/AER
|
0.35% gross/AER (+20 basis points) |
Income Bonds |
0.15% gross/AER
|
0.35% gross/AER (+20 basis points) |
Source: NS&I
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