1. Melt butter in a medium saucepan over medium heat. Add shallot and cook, stirring often, until translucent, 3 to 4 minutes. Add apple and cook, stirring occasionally, for 2 minutes. Stir in raisins, cranberries, thyme, lemon zest, water, and sugar. Bring to a boil, and then reduce heat to a simmer. Cook, stirring occasionally, until cranberries have burst, apples are tender, and mixture has thickened, about 20 minutes.

2. Remove from heat, and stir in lemon juice. Let cool to room temperature. Discard thyme and lemon zest. (Chutney will keep, covered and refrigerated, for up to 1 week. Serve chilled or at room temperature.)