Core Viewpoint - The Federal Reserve has lowered the benchmark interest rate by 25 basis points to a range of 3.75%-4.00%, marking the second consecutive meeting with a rate cut, despite uncertainties due to government shutdowns [2][4]. Group 1: Rate Cut Details - The decision to cut rates was made with a 10 to 2 vote, with dissenting opinions from members advocating for either a larger cut or no cut at all [4][10]. - The Federal Reserve will end its quantitative tightening process on December 1, having reduced its balance sheet by over $2 trillion since 2022 [3][6]. Group 2: Economic Indicators - The Fed acknowledged a lack of data due to the government shutdown, which has affected the availability of key economic indicators such as non-farm payrolls and retail sales [4][5]. - Recent indicators suggest a moderate expansion in economic activity, with employment growth slowing and a slight increase in the unemployment rate, although it remains low [4][8]. Group 3: Inflation and Employment - Inflation remains above the Fed's 2% target, with the latest Consumer Price Index (CPI) report showing an annual inflation rate of 3%, driven by rising energy costs and tariffs [5][6]. - The Fed aims to balance maximum employment with price stability, noting that risks to employment have increased recently [6][8]. Group 4: Market Reaction - Following the announcement of the rate cut, U.S. stock markets did not experience significant volatility [11]. - Other central banks in the region, including Qatar, Bahrain, and the UAE, also lowered their rates by 25 basis points in response to the Fed's decision [12].