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Two-year fixed mortgage rates held down by competition

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The average two-year fixed mortgage rate is back to where it was a year ago in spite of November's rate rise.

According to Moneyfacts, the average two-year fixed-rate mortgage today stands at 2.36%, so flat against the 2.35% in December 2016.

Rates fell noticeably throughout the year, bottoming-out at an average of 2.17% on 25 September.

But despite picking-up during the last couple of months, especially after November’s 0.25% increase to the Bank of England Base Rate, the average is still only 0.18% higher.

This suggests some lenders have either chosen not to price in the full extent of the rate rise, or are keeping rates low in the search for market share – as witnessed by several lenders offering special deals to end the year.

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