Fed cuts rates 3rd time to 3.5-3.75%; inflation remains elevated

• Federal Reserve cut its benchmark interest rate by 25 basis points for the third consecutive time, setting it at 3.5-3.75%, the lowest since 2022.
• The Fed noted that inflation remains elevated, despite the rate cut.
• The decision faced dissent, with some officials arguing for no change and one preferring a deeper cut.
• Uncertainty from a government shutdown impacting data collection complicated the final decision of the year.
• President Trump criticized Fed Chair Powell for not cutting rates sooner and hinted at replacing him.

Why It Matters: Fed rate cuts impact borrowing, investments, and the overall economic outlook.