Analysts were correct in predicting a fall in the rate of inflation in November, taking the rate to its lowest level since March 2017.
Experts were predicting that the Consumer Prices Index (CPI) rate would fall slightly to 2.30%, from 2.40% in October and they were spot on – with the fall mainly driven by a significant drop in petrol prices.
According to the Office for National Statistics (ONS), the largest downward contribution to the CPI rate was the fall in petrol prices, with price movements for both computer games and live music events also contributing to the rate drop.
These downward effects were partly offset by price rises in a variety of other categories, most notably increased tobacco prices.
So, good news for those filling up at the forecourt, gamers and for live music aficionados - but not so much for smokers!
The good news for savers is that there are far more accounts to choose from that match or beat inflation – read on for more detail on the top-paying accounts available.
Of course, the key thing to remember is that inflation is a very personal thing – how and where money is spent varies considerably between individuals and so rising and falling costs can affect some more than others.
The CPI measure should only be viewed as a general indication of the prices of goods and services – only you really know how much your own costs are rising and by how much.
However, inflation can be an effective indicator of how things are going in the wider economy.
There have been a number of commentators predicting further falls in the rate of inflation, suggesting that it may even fall below the Government’s 2% target in early 2019.
In fact, with falling inflation, you may think that there may be less pressure on the Monetary Policy Committee (MPC) to implement further rises in the base rate. However, many are still predicting that the base rate will rise in 2019, with the potential effects of Brexit on the pound to be factored into the reckoning.
A combination of improving best buy savings rates throughout 2018 and November’s fall in CPI has meant that there are more accounts to choose from that match or beat the rate - as you can see from the table below.
The drop in CPI means that you will need to tie your money up for just two years to ensure that it is not losing value in real terms.
Take a look at our fixed rate bond and Sharia account best buy tables for more detail on the top rates available.
In addition, there are a handful of interest-paying current accounts and children’s savings accounts that could be used to counteract the effects of inflation - albeit usually for smaller amounts and/or with fewer savers able to access those accounts.
Below is a handy summary of some of the top-paying accounts that beat inflation from each category.
| Provider | Account Name | Gross Rate |
| Current Accounts | ||
| TSB | Student Bank Account | 4.89% |
| TSB | Classic Plus Account | 4.89% |
| Nationwide | FlexDirect Account | 4.89% |
| Santander | 1|2|3 Student Current Account | 2.96% |
| Tesco Bank | Current Account | 2.96% |
| Nationwide | FlexPlus Account | 2.96% |
| Two year fixed term accounts | ||
| Masthaven | 30 Month Flexible Term Saver | 2.38% |
| Investec Bank | 2 Year Fixed Term Deposit | 2.35% |
| Three year fixed term accounts | ||
| Masthaven | 42 Month Flexible Term Saver | 2.42% |
| Al Rayan Bank | 36 Month Fixed Term Deposit | 2.40% |
| Atom Bank | 3 year Fixed Saver | 2.40% |
| Tandem | 3 year Fixed Saver | 2.40% |
| Masthaven | 3 Year Fixed Term Bond | 2.40% |
| Investec Bank | 3 Year Fixed Term Deposit | 2.40% |
| BLME | 3 Years Premier Deposit Account | 2.40% |
| Four year fixed term accounts | ||
| Vanquis Bank | 4 Year Fixed Rate Bond | 2.50% |
| Masthaven | 54 Month Flexible Term Saver | 2.47% |
| Ikano Bank | Fixed 4 Year Saver Account | 2.45% |
| BLME | 4 Years Premier Deposit Account | 2.45% |
| Masthaven | 48 Month Flexible Term Saver | 2.45% |
| Five year fixed term accounts | ||
| Vanquis Bank | 5 Year Fixed Rate Bond | 2.70% |
| Atom Bank | 5 year Fixed Saver | 2.70% |
| BLME | 5 Years Premier Deposit Account | 2.70% |
| Gatehouse Bank | 5 Year Fixed Term Deposit | 2.68% |
| Ikano Bank | Fixed 5 Year Saver Account | 2.62% |
| Tesco Bank | Fixed Rate Saver - 5 years | 2.62% |
| Six/Seven year fixed term accounts | ||
| BLME | 7 Years Premier Deposit Account | 2.75% |
| Shawbrook Bank | 7 Year Fixed Rate Bond Issue 2 | 2.40% |
Of course, inflation can vary from month to month and keeping pace with it can be problematic at best, but the good news is that there are far more accounts that beat inflation to choose from.
While you would have to tie your money up for at least two years to beat CPI inflation, those who need more access to their money still do not have to accept paltry rates - particularly from the big high street brands.
If you can't tie up your funds, switching to mitigate the effect of inflation is far better than leaving your funds earning next to nothing and by choosing the best rates, you are at least reducing the effect of inflation on money that you need access to.
Take a look at our independent best buy tables or call us on 0800 011 9705 for help finding the most suitable accounts for you.
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