In the United States, the Federal Reserve (also known as the Fed) is in control of interest rates. The Federal Reserve is the central bank of the United States and is responsible for implementing monetary policy. The Federal Open Market Committee (FOMC), which is a policy-making body within the Fed, meets regularly to assess economic conditions and set monetary policy, including the target for the federal funds rate.
The federal funds rate is the interest rate at which banks lend money to each other overnight. The Federal Reserve sets a target range for the federal funds rate and uses various tools, such as open market operations and the discount rate, to influence the actual rate. Changes in the federal funds rate can affect other interest rates in the economy, including those on loans and savings accounts.
The Federal Reserve considers various economic indicators, such as inflation, employment levels, and economic growth, when setting monetary policy and determining interest rates. The goal of monetary policy is to promote price stability and maximum sustainable employment.
In summary, the Federal Reserve is in control of interest rates in the United States and uses various tools to influence them. The Federal Reserve considers various economic indicators when setting monetary policy and determining interest rates to promote price stability and maximum sustainable employment. |
