Logo: 100 Years, Federal Reserve System
Why We Started
What We Do
Our Impact
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We Conduct Monetary Policy to Promote a Healthy Economy

Image of Federal Reserve Notes

WHAT is it? Monetary policy is the central bank’s actions to influence the money supply and interest rates.

Image of Upward Trending Arrow Indicating Increasing Inflation

WHY do we need it? The Fed conducts monetary policy to keep prices stable and to support a high level of employment, goals that are mandated by Congress.

Image of Federal Reserve Bank of New York Markets Trading Computer Screen Shot

HOW is it done? The Fed buys and sells government securities to influence the amount of money in the banking system, which affects interest rates throughout the economy.

Image of Federal Reserve Federal Open Market Committee Meeting

WHO is involved? Monetary policy is set by the Federal Open Market Committee, which includes the Fed’s Board of Governors and Reserve Bank presidents and meets eight times per year.