Bank launches one year fixed rate saver with 5.4% interest

Savers with Atom bank are to enjoy better rates on their fixed rates accounts and the bank is launching a new savings product.

The bank has launched a one year fixed rate saver paying 5.4 percent interest. Interest is paid gross and can be paid into the person’s Atom account or into a nominated account in their name.

From today, the bank is also boosting its rates on several of its fixed rate accounts, including its six month, nine month, one year, two year, three year and five year accounts.

Many banks and building societies have increased their rates over the past year and a half as the Bank of England has continually increased the base interest rate.

The base rate is currently at 4.5 percent with many expecting the central bank to increase the rate again.

READ MORE: Interest rates could hit six percent this year – sparking ‘correction’ in house prices

These are the new AER interest rates:

• Six month fixed rate saver – 4.8 percent
• Six month fixed rate saver (monthly interest) – 4.8 percent
• Nine month fixed rate saver – 4.95 percent
• Nine month fixed rate saver (monthly interest) – 4.95 percent
• One year fixed rate saver – 5.4 percent
• One year fixed rate saver (monthly interest) – 5.4 percent
• Two year fixed rate saver – 5.3 percent
• Two year fixed rate saver (monthly interest) – 5.3 percent
• Three year fixed rate saver – 5.3 percent
• Three year fixed rate saver (monthly interest) – 5.3 percent
• Five year fixed rate saver – 5.3 percent
• Five year fixed rate saver (monthly interest) – 5.3 percent.

Giles Coghlan, chief market analyst for HYCM, said interest rates could continue to climb.

He said: “The next inflation print is due the day before the monetary policy committee [of the Bank of England] meet.

“This will be a crucial release that will not only set the tone for this month’s decision, but also the direction of interest rates for the rest of the year.

“If this month’s inflation print – and particularly the core reading – comes in hotter than predicted again, expectations of further rates could push even higher toward the six percent mark.”

Some analysts are predicting the base rate could go up by 0.25 percent points next week, going up to 4.75 percent.

Savers may want to shop around to see if they can get a better deal with another provider.

Sarah Coles, head of personal finance at Hargreaves Lansdown, said previously: “You could wait for rates to peak before doing this, but if your money is in an unrewarding high street account in the interim, you risk missing out on significant interest in the interim.”

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