Markets were unsettled by a warning from Standard & Poor's, the credit agency, that America that risks being stripped of its prized 'AAA' credit rating unless it delivers a deficit-cutting plan within two years.
Despite these setbacks, fund supermarket Fidelity FundsNetwork has recorded Isa investors moving out of its cash park facility into funds since the beginning of the new tax year on April 6 ? with higher risk funds JPMorgan Natural Resources and Fidelity South East Asia the most popular.
Catherine Penney, of Barclays Stockbrokers said: "Interest rates remain low and there appears little prospect of returns from cash ISAs beating inflation. Many of our clients prefer to use Investment ISAs in order to achieve potentially better returns and are prepared to accept the risk in doing so."
Barclays Stockbrokers suggested that the newly increased Isa allowance of �10,680 will help encourage investors to turn to investments over cash savings.
The Obama administration reportedly asked S&P not to downgrade US debt.
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