Saratoga:
It reduces friction.
Try this in the shower. With dry hands press your palms together and try to twist your hands in opposite directions, then soap up your hands and try again. The effort you exerted in each instance is torque. Much less effort (torque) was required the second time to accomplish the same task. The lubrication did its job, displacing ever so slightly your palms.
I was taught by my grandfather, an old time school bus mechanic, that greasing bolts would result in over torquing. Read, could cause your forks to bind. So, I concur with dirthead.
And, be sure your forks are not binding as they compress, assure they are parallel to each other by leaving the axle clamps loose and pushing the forks through their travel to center them before tightening.