Saving account customers 'can expect better returns'

People with savings accounts may benefit from further interest rate hikes, it has been suggested.

Savings accounts customers may be set to benefit from interest rate increases, according to one report.

In a piece by the Australian, it was noted that many industry commentators believe the base rate to be increased to 4.5 per cent by the middle of next year.

Recent months have seen the Reserve Bank of Australia increase the level from the historic low of three per cent, up two basis points to 3.5 per cent.

The RBA recently warned that there would be a further constriction of monetary policy, meaning that further hikes could be expected.

However, this could be good news for people with saver accounts, the news provider asserted.

"People with savings, including self-funded retirees, can expect to earn progressively better returns on the most liquid part of their savings during the next year or so," it stated.

However, as a report in the Sheet recently asserted, some banks have been reluctant to pass on the rate rises to their customers, with some people not benefitting from the full increase - something that could prompt them to compare accounts.

By Bret Clement