High Inflation Is Hampering Savings!

By Author: Sadhana Dhanyal
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According to a financial expert, the high inflation is continuing to diminish the value of money put aside into savings accounts. According to Michelle Slade, with the Consumer Price Index at 3%, basic rate, the taxpayers need to find a savings account paying 3.75% interest to ensure their savings pot retains its full value.

However, it is only the fixed-rate bonds and regular saver accounts that are currently paying rates this high. Slade stated that, Inflation continues to erode the value of savers' money and with interest rates also declining, savers are being dealt a double blow.

Moreover, he added that Prudent savers are being neglected and are finding it virtually impossible to combat the effects of tax and inflation. Savers have been tempted to tie their money up in fixed rate bonds where higher rates can be achieved, but with base rate likely to rise in the next few years, most savers are only looking for a short term commitment.

Savers are expecting that the Chancellor delivers his budget after suffering some of the lowest rates on record in the last year. They are expecting that the Chancellor ...
... will bring ins some good news. On the other hand, uncertainty in Greece is pushing Euro to 10-month low against dollar.

The current uncertainty in Greece has pushed the Euro to a 10-month low against the dollar. This comes in the wake of European Union leaders preparing themselves for a two-day summit today in Brussels on March 25, 2010. The currency fell to $1.333 - its lowest level since May last year, while it also lost 0.3% against the pound to 89.338 pence.

Germany is not in favour of the Euro nations lending support to Greece. It is pressurising on the fact that the country should help itself or seek help from International Monetary Fund (IMF).

Apart from this Portugal is also struggling with its economy. It's prospects for recovery are weaker than its fellow nations in the Euro zone, which could put pressure on public finances. This is arising in the wake of the facts that the country has experienced a slump in demand for Government bonds.

On the other hand, European Commission president Jose Manuel Barroso is calling for leaders to agree an aid package for Greece. This move may help the country recover from the economic slumber that it has been facing since long. It is believed that Greece at present has the highest debt of the 16-member Euro zone, at €300 billion (£273 billion) and its economy is considered to be the Euro zone's weakest.

Sadhana Dhanyal,content developer. For more information: Personal Loan UK


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