Official figures have revealed inflation in the UK has fallen for the second month in a row in June. This will benefit those holding savings accounts.
With inflation down in June by 0.2% over May, the current rate sits at 3.2%. The downward trend means a basic rate tax payer needs a savings account paying 4.0% or higher to avoid seeing their savings get eaten by inflation.
Even more challenging, a higher rate tax payer has to locate an account anything at least 5.33% to sustain their savings.
The good news for basic rate tax payers is that there are almost 50 savings accounts available for these account holders to meet their goals.
A couple banks offering fixed rate bonds between 4.50% and 4.75% are the ICICI Bank and the State Bank of India.
Many are hoping Bank of England will increase base rate soon, so better savings rates can quickly follow.