ECB Rate Hike Boosts Deposit Rates Amid Inflation Fears

The European Central Bank (ECB) raised its three official rates by 25 basis points on September 10, setting the deposit facility at 2.50% starting September 16.

This move aims to combat new inflationary pressures caused by rising energy costs due to the conflict in the Middle East.

Not all banks will automatically raise their deposits to match this rate increase, but it's expected to fuel competition for attracting savings and potentially lead to higher deposit rates.

Savers looking for profitability without taking on stock market risk may find attractive options among banks that already offer returns exceeding 3% APR. These include BankB offering 3.75%, albeit with a significant catch: deposits must be locked in for seven, eight, or ten years.