Low interest in short-term cash deposit savings accounts, which have offered an impressive average yield of 1.87% since January, has sparked an interesting battle for short-term cash.
While Santander is offering a 1.25% interest rate on one type of cash deposit account, Popular is offering one-month products that pay 1.5%.
Short-term yeilds offer savers the chance to reinvest their savings for extra yields, but the situation could change quickly.If the risk premium continues to fall and the European Central Bank lowers interest rates as expected, then fixed-term deposits could return to the scene and become a reasonable option for investors.
