Spring statement reaction

Katie Horne, banks relationship manager at Flagstone, said: “Despite delivering her spring statement against a backdrop of extraordinary and rapidly unfolding geopolitical and economic uncertainty, this was a Chancellor who had no time for the soap opera theatrics we’ve become accustomed to with major Treasury announcements.

“The Chancellor delivered this statement, determined to herald a return to business as usual.

“We certainly got business as usual and, amid all the global turmoil, markets will thank the government for it.

“However, whether what the Chancellor is planning and the OBR is forecasting remains the case for long remains to be seen.

“After its surprise plummet in February, it was reasonable to imagine that the CPI would continue to fall over the coming months and inflation could return to its coveted two per cent spot as early as this spring.

“Falls like this would ease pressures on pricing and the general cost of living, and could even spur employers to open up more jobs.

“Next, we would then need to see unemployment figures fall, particularly among young graduates with decades-long student debts to pay.

“All that we can be sure of right now is that the assumptions made as recently as only a few days ago cannot be relied on any longer.

“While it puts undesirable pressure on the cost of living and servicing mortgages, if the base rate doesn’t fall and interest rates subsequently stay higher for longer, this creates opportunities for savers determined to put their hard-earned cash to work.

“With Cash ISA season heading into its final weeks, banks continue to offer competitive rates as the final wave of Cash ISA deposits for this tax year heads their way.

“Right now, it’s not hard to find standard and tax-free savings accounts alike offering rates at least 50 bps above the base rate and as much as 150 bps above inflation, guaranteeing competitive, protected, inflation-beating returns.

“Locking in fixed-term rates for portions of your cash might be a shrewd move in the longer term, but for savers who need some cash readily available, instant access and shorter term notice product rates should stay competitive for several weeks yet.”