When will interest rates rise for savers?

With the Bank of England (BoE) holding the base rate at 3.75% in March 2026, many savers will be wondering: what’s next for interest rates? We look at the latest forecasts and what they could mean for your savings accounts.

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Whether savings rates are likely to rise or fall depends on several factors, including how interest rates and inflation develop. While there is no way of knowing for certain what will happen, indications are that savings rates will reduce further, albeit gradually.

The Governor of the Bank of England has hinted that the base rate will continue to go down, with forecasts at the start of 2026 suggesting that it'll reach 3.5% by the end of the year. However, the 2026 conflict in the Middle East and subsequent impact on inflation and prices may change this approach. 

A central factor is the pace of inflation. Interest rates tend to be lowered when inflation is easing, as lower rates help support the economy. However, with inflation remaining above the government’s 2% target, any future rate cuts are likely to be gradual.

These aspects are important for savers and mortgage holders because any reductions to the Bank of England base rate (or Bank Rate) means borrowing money becomes cheaper but, at the same time, savings interest rates fall.

In February 2022, the BoE announced the base rate would increase to 0.5% as spiralling energy costs pushed inflation to a 30-year high. Interest rates rose again in April 2022, and by a further 0.25% in May 2022 to reach 1.00%, which was the highest level in 13 years at the time. However, with inflation still climbing, the BoE continued to increase the base rate – and by August 2023, the rate was set at 5.25%, marking the 14th consecutive rise by the Bank. The BoE then held the rate at 5.25% seven consecutive times.

In August 2024, the base rate was cut to 5% - the first reduction since March 2020. The BoE held the rate at 5% in September, and then cut it to 4.75% in November, before holding it at 4.75% in December. In February 2025, the BoE cut the base rate to 4.5%. This rate was held at the subsequent March review, but (as widely expected) cut by a quarter-point to 4.25% in May 2025. The rate was held at 4.25% in June but cut to 4% in August. The rate was then held at 4% in September and November, before a cut to 3.75% in December 2025. The rate was held at 3.75% in February and March 2026.

The next interest rate decision is on 30 April 2026.

The MPC reviews and announces the base rate eight times a year (approximately every six weeks). You can view the upcoming dates for 2026 on the BoE website.

The best savings account for you will depend on your personal circumstances and how much flexibility you will require. However, some of the highest interest rates can be found on fixed rate bonds. Regular savings accounts often also offer high interest rates, but these come with restrictions, like the amount of money you can deposit per month.

The direction of UK savings interest rates in 2026 will depend on a number of factors, including inflation, interest rates, and economic growth.

2025 saw inflation rise and fall numerous times, finally settling at 3.2% by the end of the year. Inflation was 3% in January 2025, although there was a subsequent decrease to 2.8% in February, and a further decrease to 2.6% in March. This trend was reversed in April 2025, however, with an increase to 3.5% (later revised to 3.4%), then to 3.6% in June. Inflation increased further to 3.8% in July 2025, a rate which subsequently held throughout August and September 2025. Inflation decreased to 3.6% in October 2025, before dropping further to 3.2% in November 2025. 

The first month of 2026 saw inflation fall to 3%, a rate that held in February 2026. This figure didn't account for the impact of the conflict in the Middle East on prices, however, and experts expect inflation to increase again over the course of 2026. 

Whether or not you should fix your savings now or wait depends on your individual circumstances and financial goals, but with interest rates already falling, now could be the ideal time to lock your money in. Longer-term savings accounts, for example 2 or 3 year fixed rate bonds, are an attractive option for savers as they often guarantee good returns.

Another thing to consider is how long you plan to keep your savings fixed. If you know you’ll need access to your money in the short term, then fixing your savings for less than a year may be a good option for you. However, if you are saving for a long-term goal, such as retirement, then you may want to consider fixing your savings for a longer period of time. This will give you more certainty over how much interest you will earn over the long term.

Ultimately, the decision is a personal one. There is no right or wrong answer, and the best decision for you will depend on your individual circumstances and financial goals.

Regardless of what happens to the savings interest rate, there’s never a bad time to save. To find the best savings account for you and compare interest rates on savings accounts, register for a Raisin UK Account and log in to apply.