Squeeze on saving rates as mortgage cuts loom

Some of the highest savings rates on offer in Ireland are likely to be squeezed lower, a leading analyst has said, as the political war of words over the rates lenders charge for mortgage loans hots up more.

Emer Lang, bank analyst at Davy Stockbrokers, said that Permanent TSB, which pays among the highest rates to savers to hold their money for a year, “could have room to manoeuvre” to lower its deposits rates if pressure builds further on cuts to home loan rates.

After AIB and KBC said on Monday they would cut their mortgage rates, Fianna Fáil stepped up its home loans rate-cutting campaign, saying AIB should “urgently clarify” whether it plans to extend its lower mortgage rates to its EBS and Haven subsidiaries.