Savings rates offer the highest real rates in more than a year, according to data from Moneyfactscompare, after today’s inflation figures showed the pace of price increases dropped to 2.6% in June.
In contrast, the Moneyfacts Average New Savings Rate is at 3.59%, around 1 percentage points ahead of inflation – the largest gap since March 2025.
The average savings account has moved from paying 0.34 percentage points below inflation last September to 0.99 percentage points above inflation today, a swing of more than 1.3 percentage points.
Adam French, head of consumer finance at Moneyfactscompare, said: “While the cost of living continues to weigh on household budgets, the latest inflation figures provide some small relief, especially for savers.
“For many savers, what matters most isn't whether savings rates rise or fall in isolation but whether they stay ahead of inflation and, as things stand, they are doing just that, allowing many households to preserve or grow their purchasing power."
There are currently 1,960 savings accounts that beat inflation, including 284 easy-access accounts and 412 fixed-rate ISAs. This is up from 1,825 savings accounts that beat inflation last month.
This gives many savers “plenty of opportunity to shop around for the best deals and grow the real value of their money,” said French.
The difference between an average account and one of the market-leading deals can amount to more than £140 on a £10,000 balance over a year, he noted, with the top easy-access savings account from Revolut paying 5%.
However, earlier today, experts warned that inflation may not stay subdued for long, a sentiment that French agreed with, noting that price rises could creep higher over the coming months.
“Any subsequent increase in inflation will squeeze household budgets further and reduce the real value of savings unless providers continue to offer competitive returns,” he said.
“This fresh uncertainty may make the top-paying easy access savings accounts a more attractive option. These accounts offer the flexibility to access funds should they be needed in the face of rising living costs and those willing to shop around can take advantage of any further increases in savings rates if providers respond to changing inflation and interest rate expectations.
“In uncertain and increasingly volatile economic times, maintaining both competitive returns and financial flexibility is likely to be a priority for plenty of households,” he concluded.