Continued lender rate cuts caused the average cost of fixed-rate mortgages to fall by up to 2bps this week, according to Moneyfacts.

The firm’s latest rate watch data showed that the average two-year fix fell to 4.91% from 4.92% last week, with the typical five-year fix dropping to 4.96% from 4.98%.

Moneyfacts’ overall average mortgage rate fell to 4.96%, from 4.98% a week previously.

The mortgage category to see the biggest fall in rate were three-year fixes. A three-year fix up to 90% LTV fell 5bps to an average rate of 4.95%, with a similar fall being seen in three-year fixes to 60% LTV, now 4.14%.

Other large drops in rate were seen in two-year fixes to 90% LTV, which fell 3bps to 5.18%.

Moneyfacts finance expert Rachel Springall said: “Fixed rate mortgage cuts took precedence this week, which will be great news to borrowers as even the biggest banks were on board to reduce rates, alongside mutuals and challengers.

“There were a few prominent brands to make fixed rate cuts, which included first direct by 27bps, Barclays Mortgage by 21bps, HSBC by 17bps, Santander by 14bps, Lloyds Bank and Halifax by up to 10bps and TSB by 10bps.

“Several building societies made cuts to fixed rates, which included Yorkshire Building Society up to 18bps, Progressive Building Society up to 29bps, Nottingham Building Society up to 21bps, Cumberland Building Society by 20bps, Leeds Building Society up to 17bps, Principality Building Society by 13bps and Leek Building Society by 8bps.”