Barclays is the latest lender to announce it will cut mortgage rates across its fixed rate deals aimed at home buyers.

From tomorrow, the high street bank will offer the best deal on the market after cutting its lowest two-year fix to 3.73 per cent for those buying with at least a 40 per cent deposit. 

On a £200,000 mortgage being repaid over 25 years, that would equate to paying £1,026 a month. It comes with a £899 product fee that can either be paid upfront or added to the loan.

For those that are Premier Banking customers with Barclays it's possible to get a 3.72 per cent rate. 

Only Lloyds Bank has an exclusive deal for its banking customers that's cheaper, at 3.67 per cent.

A host of big banks have lowered rates over the past week. Both HSBC and Barclays were first to do so last week, closely followed by NatWest, Halifax and Santander.

Barclays' announcement comes with Goldman Sachs predicting that the Bank of England will cut interest rates to 3.75 per cent next week. 

Previously, most were expecting the rate to remain at 4 per cent until February next year.

Analysts at the investment banking giant argue that fading pressures and sluggish growth will open the door to a move sooner than most other analysts and traders expect.

If correct, this could pave the way for further mortgage rates cuts over the coming weeks.

Aaron Strutt of mortgage broker Trinity Financial, said: 'It only takes one or two of the big lenders to lower their prices for other large and smaller mortgage providers to follow.'

'If the base rate comes down next week or in December we may well have noticeably better rates to start the year with.'

A further sign that further mortgage rate cuts could be on the way are Sonia swap rates. 

The price of fixed mortgages is heavily influenced by Sonia swap rates - the inter-bank lending rates which are based on expectations of where rates will be in the future. 

As of today, two-year Sonia swaps are at 3.5 per cent and five-year sonia swaps are at 3.58 per cent.

Only a month ago, two-year swaps were at 3.72 per cent and five-year swaps are at 3.8 per cent.

Will the base rate fall next week? 

While Goldman Sachs is predicting a base rate cut next week, the overall market is slightly less convinced. 

Financial markets have gone from pricing in less than a 25 per cent chance of another rate cut by the end of the year to a two-thirds chance now - but that means a cut could come in December.

This is due to a lower inflation peak and rumours of a less inflationary budget. 

'We doubt this will be enough to tempt the Monetary Policy Committee into a rate cut next week,' says Thomas Pugh, chief economist at leading audit, tax and consulting firm RSM UK. 

'We expect a 3-6 vote for a hold. But it throws the door wide open to a rate cut in December, especially if the budget is deflationary.'

Pugh is expecting the Bank of England to take a more cautious approach to rate cutting than Goldman Sachs' analysts.

'The MPC will want to see what is actually in the budget before committing to further rate cuts,' he says.

'Our hunch is that the next rate cut still won’t come until February, as the committee will want to let inflation come down a little further. 

'But the door to a December rate cut is now potentially wide open, especially if the budget focuses on deflationary tax rises - like income tax increases - and shies away from things that would boost inflation such as employers NICs, VAT, duties etc. 

Pugh adds: 'All this is undoubtedly good news for Rachel Reeves, as it will lower the government’s borrowing costs. It will also go some way to lowering cooperate borrowing costs and mortgage rates.'