subject: Fixed rate bond market heats up as savers earn higher returns [print this page] Fixed rate bond market heats up as savers earn higher returns
With July the month that bond maturities are expected to peak - fast approaching, some fixed rate bond providers have upped their game in the competition through increased rates, offering higher returns for savers.
Barclays today launched a new 2 year fixed rate bonds product offering up to 3.70%, one of the highest paying products of its kind on the current savings market.
The move from Barclays comes at a time when several fixed rate offers have been withdrawn or had rates reduced, so the new bond is likely to see Barclays heating up the competition and setting a new trend.
Andy Gray, Barclays Head of Mortgages and Savings said: "Our two year fixed rate is one of the best short term rates available to savers, particularly at a time when some competitors have been cutting their rates. This bond gives savers a safe haven for their money, offering them the opportunity to secure a great high fixed interest rate from just 500.
"The rate increase will have a major impact on our customers' savings particularly those customers who are looking to earn a regular income from their savings."
The current top paying Barclays fixed rate bond offers 3.70% gross p.a/AER on balances of 50,000 and above and 3.30% on balances below 50,000, while the minimum investment stands at just 500. This will offer a safe haven for customers, hoping to take advantage of the ongoing record low base rate, which is likely to remain unchanged for some time.
ICICI UK are offering a similar selection of fixed rate bonds and have also increased the rate on the ICICI two year fixed rate bond to 3.70% gross p.a/AER on balances of 1,000 or more.
Savers looking to invest for a shorter period of time may wish to consider the ICICI fixed rate bond that carries a term of just one year and pays an impressive 3.0% gross p.a/AER on balances of 1,000 or more.
