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Coventry Building Society has announced it will be increasing the interest rate of its Limited Access Saver account. The online savings account will see its rate raised by 0.15 percent to a “market-leading” 3.25 percent next week.
This hike to the savings product’s interest rate will be available to new and existing members on Tuesday March 21, 2023.
The Limited Access Saver account gives costumes six withdrawals each year based on the day the account is opened,
It should be noted that any additional withdrawals are subject to a charge equal to 50 days’ interest.
New applications for this account from Coventry Building Society can be opened online for just £1.
Savers can decide on either annual or monthly interest, which can be added to the account or paid away.
Any new customers to Coventry Building Society should know that this saving account can only be opened and managed online.
As well as this, new and existing customers can only hold one Limited Access Saver account at any time.
This latest intervention from Coventry Building Society is one of many interest rate hikes from the financial institution in recent months.
Daniel McDonald, senior product manager at the building society, outlined why savers should take advantage of this new offering.
He explained: “The increase we’re introducing to our popular online Limited Access Saver will be welcome news for existing account holders as well as those looking for the market’s top rate on a flexible account.
“The account already offers good value while having some flexibility to occasionally dip into savings and access money.
“The increase to 3.25 percent will be applied automatically to the account benefiting both current and new members with a boost in rate next Tuesday.”
Interest rates for savings accounts have increased substantially over the last year by high street banks and building societies.
This is partly in response to the Bank of England’s decision to raise the UK’s base rate in a bid to control inflation.
The base rate is currently at four percent, after having been raised 10 times in a row, with further hikes expected in the near future.
While more interest rate rises may be beneficial for savers, mortgage holders and people in debt have been hit hard by the central bank’s actions.
Laith Khalaf, head of investment analysis at AJ Bell, shared why further rate hikes from the Bank of England may be in the future.
He added: “There’s been a big shift in monetary policy expectations, which suggests we are now pretty close to the top of the interest rate cycle in the UK.
“Markets are currently pricing in a ‘one and done’ hike for the Bank of England, with a peak of 4.25 percent for the UK’s base rate.
“There is considerable uncertainty about the precise timing of the remaining interest hike that’s been pencilled in though, with a 50 percent chance placed on it happening at the forthcoming March meeting.”
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