The Federal Reserve handed down a large interest rate cut this week, dialing back the central bank's fight against inflation and signaling welcome relief for borrowers. It remains to be seen, however,

The federal funds rate is the interest banks charge each other for overnight loans. Set by the Federal Reserve, it's a basis for other interest rates.

Some forecasters expect the Fed to cut interest rates by a quarter-point Wednesday. Most, however, expect a half-point reduction. The CME FedWatch forecast tracker favored a half-point cut by a 55-45 margin at midday. (Earlier Wednesday, forecasters rated the probability of a half-point reduction even higher.)