Federal Reserve Announces Larger-Than-Expected Interest Rate Cut; Experts Weigh Impact On Borrowers

The Federal Reserve announced that it's cutting interest rates, and the cut is more than many experts predicted. This decision could help those trying to borrow money for a car or home.

Wall Street correspondent Bradley Blackburn spoke with News 9's Tevis Hillis about what this cut could mean.

Blackburn says that in comments today the Fed pointed to good news on inflation.

“It's gone down from a high of over 9% to just over 2% currently, said Blackburn. “And so that's why rates have been held so high for so long. They were at a 23-year high until this rate cut was announced.”

Now Blackburn says the goal is to inject money into the economy by reducing this rate.

Good things can come from these interest rate cuts but there could also be some downsides.

This rate controls the rate for which banks charge each other when they lend money on a short-term loan. Eventually, that can trickle down to mortgage rates and credit card interest rates, which is good news for borrowers. On the downside, for people who have money in a savings account or a CD interest rates are down so you won't get as much for your money in the future.

These changes won't be immediate, but the Fed says this will be the first cut of many.

For the average Oklahoman, it might take a while to see the effects of this change. This cut was already anticipated by lenders so things like mortgage rates have already been coming down from highs.