Rates on euro offshore savings accounts are creeping up, despite the European Central Bank keeping rates on hold for almost a year.
Latest research from the Euro Offshore Savings Account Index, produced by Investec Bank (Channel Islands) showed a rise in the average interest rate of 0.8% between 31 January and 30 April, up from 3.56% to 3.64%. The ECB repo rate has been held at 4% since June 2007, when it was raised from 3.75%.
The index shows interest rate differentials between the ECB rate and the average offshore account widened following the start of the research in 2005, although the last two readings have seen the gap narrow to an unprecedented level.
Laura Preston of Investec in Guernsey said: “It is widely acknowledged that many banks are increasing rates on their deposit accounts as they look to bolster their balance sheets. This is great news for clients; however, they should still be encouraged to shop around as significant discrepancies remain in the rates available, with the top accounts, such as the Investec Horizon Account, paying as much as 0.75% above ECB rate.”
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