Bank borrowing from the Federal Reserve's emergency lending program over the past week fell to the lowest point in more than two years, further evidence that credit markets are improving.

The Fed said that banks averaged $105 million in borrowing for the week ended on Wednesday. That was the lowest borrowing since it averaged $23 million for the week ended March 12, 2008, before the credit crisis struck with full force.

Loans from the central bank's emergency lending program, known as the discount window, had surged to a high of $110 billion a day during the height of the financial crisis in the fall of 2008. At the time, banks found their customary sources of credit frozen.

The $105 million average borrowing for the week ended Wednesday was down from an average of $678 million in borrowing for the previous week.

With financial and economic conditions improving, the Fed has been winding down its special lending programs.

The largest of these efforts is a $1.25 trillion program to purchase mortgage-backed securities issued by Fannie Mae and Freddie Mac in an effort to lower mortgage rates and provide a boost to the depressed housing market.

The new report showed that those holdings averaged $1.11 trillion daily for the week ended Wednesday, up by $138 million from the average for the previous week.

Some economists have worried that mortgage rates would start rising once the Fed's purchases of mortgage-backed securities end.

But Fed officials have stressed that even after new purchases end, the central bank will be holding a sizable portfolio of these types of securities that will continue to provide support for the mortgage market.

The European debt crisis has also pushed mortgage rates down in the United States as investors have moved their money into the safety of U.S. assets.

Freddie Mac reported Thursday that the national average for 30-year fixed-rate mortgages dipped this week to the lowest level of the year, declining to 4.72 percent, down from 4.79 percent last week. The decline puts the rate just shy of the record low of 4.71 percent set last December.