moneysupermarket.com comments on the launch of Bradford and Bingley's one-year fixed-rate ISA

Edited by the Insidemoneytalk editorial team Oct 4, 2007

Commenting on the launch of Bradford and Bingley's one-year fixed-rate ISA, paying 6.2 per cent AER, Kevin Mountford, head of savings at price comparison site moneysupermarket.com, said:

"What a difference a couple of weeks makes".

"It wasn't very long ago we were seeing a raft of fixed-rate ISAs near seven per cent but these have all but disappeared due to one year swap rates falling close to six per cent, dragging down the rate providers will pay".

""It is ISA accounts that have suffered most with non-ISA bonds still offering reasonable returns.

While in comparison to where we were, the rate from BandB isn't exciting, the ISA option should still be the first port of call, noting the tax benefit".

""Beyond this however it does pose a wider question on whether easy access accounts will soon present better value or, if you adhere to the view that the base rate will start to fall, locking in at 6.2 per cent could still present a pretty good move".

"No one can predict the future, but it will be interesting to see what shape the savings market is in a couple of weeks from now - especially with the balance between falling money rates and providers needing deposits.".