Interest rate changes refer to adjustments made by central banks, like the Federal Reserve, to the cost of borrowing money. When interest rates rise, loans become more expensive, which can slow down spending and investment. Conversely, when rates fall, borrowing becomes cheaper, encouraging consumers and businesses to spend more. These changes can significantly impact the economy. For example, lower interest rates can stimulate growth by making it easier for people to buy homes or cars. On the other hand, higher rates can help control inflation by reducing the amount of money circulating in the economy.