Boo hoo! Savers across the UK are in mourning. The only savings account that actually kept up with inflation (ie was a savings account rather than a losings account) has closed. National Savings & Investments have stopped sales of their 5-year, RPI+0.5 pa, tax-free certificates. Yesterday you could have had £15,000 worth of these little treasures - today you can't.
Meanwhile bankers everywhere are celebrating. They hated NS&I for offering the saving public a good deal, alright, an adequate deal.
The deal has been pulled only four months after it was first offered. The two billion pounds the government wanted to raise has been raised. The rest of the £120bn deficit will come from gilts instead. The government seems to have decided that raising money this way will be cheaper for them.
Yes, paying 3.5% on gilts will be cheaper for the government over five years than paying RPI+0.5%. Can you work out what the government actually thinks is going to happen to inflation over the next five years? (As opposed to the "return to the 2% target over the next two years" mantra they normally chant.)