Mortgage lenders have continued to cut fixed rates, causing the average two year fixed mortgage rate to fall further, according to analysis from Moneyfacts.co.uk.

Last week it reported that that the average rate on a two year fixed rate mortgage product fell below 5.00% (4.99%) for the first time since June.

Since then, rates have fallen even further, with the average currently standing at 4.86%. This represents that most marked weekly decline since the beginning of the year, when the Bank of England cut the base rate of interest by 0.50% to 1.50%, Moneyfacts.co.uk says.

Amongst the lenders to have cut fixed rates in the last week include:

Abbey – selected rates cut by 0.20%
Accord Mortgages – rates cut by 0.40%
Alliance & Leicester – selected rates reduced by up to 0.25%
Cheltenham & Gloucester – selected rates cut by 0.10%
first direct – selected rates reduced by 0.05%
Leeds BS – selected rate reduced by 0.26%
Post Office – rates reduced by up to 1.30%
Scottish Widows Bank – rates reduced by up to 0.40%
Yorkshire BS – rates reduced by up to 0.30%.

Michelle Slade, spokesperson for Moneyfacts.co.uk, said: “Lenders finally appear to be putting the ‘open for business’ sign back in the window and bringing competition back to the mortgage market. Margins on fixed rate mortgage deals have steadily increased in the last year as lenders looked to repair damaged balance sheets.