WASHINGTON — The Federal Reserve cut interest rates Wednesday for the second time in two months, hoping to prevent a housing downturn and subprime mortgage crisis from undermining the health of the rest of the economy.

But the Fed's interest-rate committee also indicated that inflation remained a worry, especially with oil prices still on the rise, and it sent a signal that this would probably be the last rate cut for the foreseeable future.

"The committee judges that, after this action, the upside risks to inflation roughly balance the downside risks to growth," the Fed said in a statement.

The quarter-point drop in the central bank's key short-term interest rate to 4.5 percent is intended to prevent a further tightening of consumer credit and make it marginally easier for homeowners to refinance mortgages and home equity loans.

Major banks quickly cut their prime lending rate by a quarter-point to 7.5 percent. The prime rate is used as a benchmark for many consumer loan rates, including home equity credit lines. The drop in the prime will mean lower interest costs for consumers whose loans are tied to the prime.

Earlier in the day, the Commerce Department reported that the economy grew a stronger-than-expected annual rate of 3.9 percent in the third quarter. Although the housing market showed sharp declines, they were offset by strong exports and consumer spending.

The third-quarter figures "show continued resilience in a two-track economy, with housing declining dramatically but the rest of the economy actually accelerating," said Nigel Gault of Global Insight forecasters in Lexington, Mass.

But most economists don't think the acceleration will continue. Most think that the slide in home prices will put a drag on consumer spending in the last few months of the year, which will slow the economy considerably.

"We're still forecasting 1.8 percent growth for the fourth quarter," said Scott Anderson, senior economist at Wells Fargo Economics. "I think four is going to be much slower than three."

Rising oil prices remain a particular concern — the price of crude oil shot up again on Wednesday, reaching a record of nearly $95 a barrel. Rising transportation costs are expected to force up prices on consumer goods, and a cold winter and high heating costs could shock residents of the country's colder climates.

"The question now is how well (the economy) can withstand even steeper declines in residential construction, the general tightening in credit conditions, falling house prices, oil prices at around $90 per barrel, and their negative implications for consumer and business spending," Gault said. "We expect the damage to come through soon."

He predicted the economy would grow at only a 1.5 percent annual rate in the fourth quarter, and no faster than that in the first half of 2008.

In its statement, the Fed suggested that its policymakers didn't think that the economy has seen the full effects of the housing crisis, which has led to a tightening of consumer credit and instability in financial markets as mortgage-backed securities have faltered.

"The pace of economic expansion will likely slow in the near term, partly reflecting the intensification of the housing correction," the Fed said. The rate cuts last month and Wednesday "should help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets and promote moderate growth over time."

But at the White House, Bush administration officials argued that the third-quarter growth data suggest the economy is more resilient than the jittery markets suggest.

"The housing market is clearly the weak sector of the economy right now, and has been for the past year and a half," Edward Lazaer, chairman of President Bush's Council of Economic Advisers, said at a White House news conference. "Despite that, housing does not seem to be leaking into other parts of the economy."