NS&I changes rates

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NS&I changes rates

Tue 14th Oct 2008

National Savings & Investments (NS&I) has reduced its rates in response to last week's base rate cut.
NS&I said this was in response to the Bank of England slashing the base rate from five per cent to 4.5 per cent.
Its changed rates will come into effect on October 22nd on some of its variable rate products, on November 1st for Premium Bonds and November 6th for Income Bonds.
Premium Bond prize fund rates will drop from 3.25 per cent per annum to 2.85 per cent, although there will still be more than a million tax-free prizes every month and two £1 million ones.
The total value of prizes is estimated to fall from £104,565,250 to £87,839,800.
Last week, NS&I announced that the interest rate on its Direct ISA was also decreasing following the base rate cut.
It has gone from 5.30 per cent per annum to 4.8 per cent, but is guaranteed to be 0.3 per cent above the base rate until April 5th 2009.

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