Group 1 - The Federal Reserve continues its interest rate cut by 25 basis points and plans to end its balance sheet reduction (QT) in December [1][2] - The target range for the federal funds rate is lowered from 4.00%-4.25% to 3.75%-4.00%, marking the first consecutive rate cuts in a year [1][2] - Market expectations have fully absorbed the likelihood of three rate cuts this year, with a 99.9% probability for the recent cut and a 91% probability for another cut in December [2] Group 2 - The decision to end the balance sheet reduction means that the Fed's QT actions will conclude after three and a half years, with short-term Treasury securities replacing maturing MBS holdings starting in December [2][3] - The Fed will reinvest principal payments from maturing securities into short-term U.S. Treasury bonds, with specific limits on the amounts for different securities [3] Group 3 - Fed Chair Powell indicated that there is significant disagreement among committee members regarding the potential for another rate cut in December, emphasizing that future policy is not predetermined [5][6] - Economic activity is expanding at a moderate pace, with GDP growth at 1.6% for the first half of the year, lower than the previous year's 2.4% [6] - The labor market is showing signs of cooling, with employment growth slowing and increased risks to job stability noted [6][8]