Martin Lewis tells anyone with savings to take action from Thursday

Martin Lewis has urged savers to take action from today (Thursday) as the Bank of England cuts interest rates again.

Money Saving Expert Martin Lewis is currently taking a self-imposed sabbatical from work, but before he went on his break, he issued advice to savers focused on the Bank of England base rates decision which was announced today (Thursday, August 7).

The Bank of England announced earlier today that it is cutting interest rates by 0.25 percentage points, a cut from 4.25% to 4%.

The Bank's Monetary Policy Committee (MPC) chose to reduce interest rates by 0.25 percentage points to its lowest level since March 2023. Policymakers pointed to a recent fall in pay growth and reduced uncertainty over the impact of US tariffs. Consumer price index (CPI) inflation is now on track to peak at 4% in September, surpassing previous guidance that it would peak at 3.5%. The increased cost of living is largely being driven by higher energy and food prices, according to the Bank.

Although it's good news for debt, as the cost of debt like mortgages reduces, it's bad news for savers, who will see their money grow more slowly. Although savings rate changes have not yet been announced by individual banks, it is thought that adjustments to savings rates will be announced in the coming weeks.

Savings and current accounts which are not fixed rate are variable, and usually track the Bank of England base rate. For example, Chase bank's tracker currently tracks 1.5% below the base rate, meaning your savings rate will reduce from 2.75% to 2.5%. The same will be true for anyone with a tracker savings rate at their bank.

Before the rate change was announced, Martin Lewis said via his Money Saving Expert website that savers would need to 'take action' following any cut to interest rates.

He said at the time: "Most analysts believe this Thursday the Bank of England will likely cut the UK base rate again, from the current 4.25% to 4%. Good news for some with debt, but a sign savers need to take action."

Martin then explained the best ways to boost your savings to get a better rate via MSE, which include a 4.5% fixed savings deal from Vanquis Bank.

This guarantees a fixed 4.44% rate on savings between £1,000 and £250,000. Other options include Zenith at 4.47%, NS&I at 4.18%, and Cynergy at 4.3%, all for a one-year fix, all above the current base rate.