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Newcastle Building Society has launched a best buy easy-access savings deal that promises to track the Bank of England base rate until 31 December 2025.
The Newcastle Base Rate Tracker is available from today and kicks off with a market leading 4.3 per cent rate.
The deal guarantees an interest rate that will not fall less than 0.7 percentage points below the Bank of England Base Rate.
Tracker rate: Newcastle BS says that when the Bank of England Base Rate changes, the interest rate on the account will change.
Last week, the Bank of England upped base rate to 5 per cent. It marked the bank’s 13th base rate hike since December 2021, resulting in the sharpest rise since 1989 – a jump of 4.9 percentage points over 18 months.
The deal is open to everyone, not just Newcastle’s customers.
Savers can open the new account either online or in branch with just £1 and can thereafter deposit up to £250,000 – albeit savers have FSCS protection up to £85,000 per person.
Crucially, the deal is an easy-access account without any restrictions. There is no limit to the number of deposits or withdrawals a customer can make.
Someone putting £10,000 in this account could expect to earn £430 of interest over the course of the next 12 months.
However, the rate could change during that time, given it is dependent on the Bank of England base rate.
Markets now expect that the Bank of England will raise the base rate to 5.75 per cent later this year. Some traders are even betting it on it getting to 6 per cent.
If the Bank of England does increase base rate to these levels then those that have the Newcastle new tracker deal could find themselves earning more than 5 per cent from an easy-access deal.
Newcastle BS says that when the Bank of England base rate changes, the interest rate on the account will change no more than five working days after the change is effective.
The next best easy-access savings rate is offered by the savings and investment app Chip* and pays 4.21 per cent.
The average easy-access rate across all accounts is 2.37 per cent, according to Moneyfacts data, with many of the major banks paying much less.
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