The U.S Federal Reserve announced today they will cut the interest rate by a quarter percentage point from the current 4.25%-4.5% range.

Today’s announcement puts the overnight funds rate in a range between 4%-4.25%.

In a statement, the Fed noted that economic activity “moderated” but said “job gains have slowed,” while adding that inflation “has moved up and remains somewhat elevated.”

The fed also indicated a possibility of two more rate cuts before the end of the year.

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.