Assessing impact of historic interest rate cut one month on

Just 29% of mortgage providers have announced a cut to their standard variable rate (SVR), with only 11 lenders opting to pass the cut on in full.

The reduction passed on by lenders to their SVRs ranges from between 0.04% and 0.50% and a third of all lenders still have an SVR of over 5%, double that of the lowest SVR, which stands at 2.50%

Michelle Slade, analyst at, said: "With each base rate cut, the number of lenders passing the cut on in full to their SVR continues to dwindle. Many lenders have now cut rates as low as they are prepared to go.

"Even large mortgage lenders such as HSBC, NatWest, Northern Rock, Royal Bank of Scotland, Woolwich and Yorkshire BS have made no change to their SVR.

"Many of the lenders that passed on this month’s cut made no reduction last month, while others have a guarantee to pass on the cut and have no option but to do so.

"The average two-year fixed rate continues to fall, currently standing at 4.65% compared to 4.74% at the beginning of the month.

"Despite a fall in base rate the average two-year tracker mortgage has increased, jumping from 3.54% at the beginning of March to 3.62% today. The result of some of the lowest margin over base deals being withdrawn."

Some 72% of providers have announced cuts in their savings rates with the majority passing on the full cut to at least one of their accounts.

Fourteen providers opted to pass on less than full cut including Anglo Irish Bank, Holmesdale BS, Northern Rock and Virgin Money.

The average savings rate on a no-notice account now stands at just 0.66%, based on a £5000 balance, with 56% of these accounts paying a rate of 0.50% or less and 28% of accounts paying a miserly 0.10% or less.

Slade said: "With many accounts already paying extremely low rates even before last month’s cut, there was not much further many of the providers could go. As a result the average savings rate has fallen from 0.83% at the start of March to 0.66% today.

"Just 11% of accounts on the market pay a rate of over 2%, so it is imperative that savers review what rate they are currently receiving.

"Many people are predicting that bank base rate has gone as low as it can and savers will be hoping that rates now start to improve.

"We have already seen the first signs of providers offering more competitive deals to savers with the launch of many best buy products in the last month, including the Premier Guarantee from Manchester BS paying 2.66% and the two-year Premium Gold account from Close Brothers paying a fixed rate of 4.30%.

"With RPI falling to 0% this month, savers are once again seeing real returns on their money."

Have your say on this story using the comment section below