The U.S Federal Reserve has announced its third consecutive interest rate cut, slashing the federal funds rate by 25 basis points.

The move, which was widely expected, reduces their overnight borrowing rate to a target range of 4.25%-4.50%, about where the rates were in December 2022.

In making their announcement, the federal reserve also suggested that future rate cuts may be scarce.

Higher interest rates make it more expensive for companies and individuals to borrow funds, which in turn, restricts access to cash and constrains their ability to spend, reducing pressure on prices.

Mortgages are also tied to yields for government bonds, and have an affect on housing prices as well.