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Federal Open Market Committee: Difference between revisions
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{{Short description|Chief body of the U.S. Federal Reserve System that sets national monetary policy}} | {{Short description|Chief body of the U.S. Federal Reserve System that sets national monetary policy}} | ||
{{ | {{Organization | ||
|OrganizationName=Federal Open Market Committee | |||
|OrganizationType=Independent Agencies | |||
|Mission=To oversee open market operations that influence U.S. monetary policy, aiming to promote national economic goals like price stability, high employment, and moderate long-term interest rates. The FOMC adjusts money supply primarily through buying and selling of U.S. Treasury securities to achieve these objectives. | |||
|OrganizationExecutive=Chairman (also the Chair of the Federal Reserve Board) | |||
|Employees=Variable (comprises members from Federal Reserve Board and Bank Presidents) | |||
|Budget=Not applicable (operates under the Federal Reserve System's budget) | |||
|Website=https://www.federalreserve.gov/monetarypolicy/fomc.htm | |||
|Services=Monetary policy decisions; open market operations; setting interest rates; | |||
|ParentOrganization=Federal Reserve System | |||
|CreationLegislation=Banking Act of 1935 | |||
|HeadquartersLocation=38.894409, -77.026701 | |||
|HeadquartersAddress=1200 Pennsylvania Ave, NW, Washington, DC 20460 | |||
}} | |||
The '''Federal Open Market Committee''' ('''FOMC''') is a committee within the [[Federal Reserve System]] (the Fed) that is charged under [[United States law]] with overseeing the nation's [[open market operations]] (e.g., the Fed's buying and selling of [[United States Treasury security|United States Treasury securities]]).<ref name="what is fomc">{{cite web|url=http://www.federalreserve.gov/monetarypolicy/fomc.htm|access-date=February 23, 2016|title=What is the FOMC and when does it meet?|publisher=Board of Governors of The Federal Reserve System|date=December 2015}}</ref> This Federal Reserve committee makes key decisions about interest rates and the growth of the United States money supply.<ref>{{cite book | last1 = O'Sullivan | first1 = Arthur | author-link = Arthur O'Sullivan (economist) | first2 = Steven M. | last2 = Sheffrin | author-link2=Steven M. Sheffrin | title = Economics: Principles in Action | publisher = Pearson Prentice Hall | year = 2003 | location = Upper Saddle River, NJ | page = 418 | isbn = 0-13-063085-3}}</ref> Under the terms of the original [[Federal Reserve Act]], each of the Federal Reserve banks was authorized to buy and sell in the open market bonds and short term obligations of the [[United States Government]], bank acceptances, cable transfers, and bills of exchange. Hence, the reserve banks were at times bidding against each other in the open market. In 1922, an informal committee was established to execute purchases and sales. The [[Banking Act of 1933]] formed an official FOMC.<ref>{{Cite book|title=Money and Banking|publisher=American Institute of Banking|year=1940|location=New York|pages=440}}</ref> | The '''Federal Open Market Committee''' ('''FOMC''') is a committee within the [[Federal Reserve System]] (the Fed) that is charged under [[United States law]] with overseeing the nation's [[open market operations]] (e.g., the Fed's buying and selling of [[United States Treasury security|United States Treasury securities]]).<ref name="what is fomc">{{cite web|url=http://www.federalreserve.gov/monetarypolicy/fomc.htm|access-date=February 23, 2016|title=What is the FOMC and when does it meet?|publisher=Board of Governors of The Federal Reserve System|date=December 2015}}</ref> This Federal Reserve committee makes key decisions about interest rates and the growth of the United States money supply.<ref>{{cite book | last1 = O'Sullivan | first1 = Arthur | author-link = Arthur O'Sullivan (economist) | first2 = Steven M. | last2 = Sheffrin | author-link2=Steven M. Sheffrin | title = Economics: Principles in Action | publisher = Pearson Prentice Hall | year = 2003 | location = Upper Saddle River, NJ | page = 418 | isbn = 0-13-063085-3}}</ref> Under the terms of the original [[Federal Reserve Act]], each of the Federal Reserve banks was authorized to buy and sell in the open market bonds and short term obligations of the [[United States Government]], bank acceptances, cable transfers, and bills of exchange. Hence, the reserve banks were at times bidding against each other in the open market. In 1922, an informal committee was established to execute purchases and sales. The [[Banking Act of 1933]] formed an official FOMC.<ref>{{Cite book|title=Money and Banking|publisher=American Institute of Banking|year=1940|location=New York|pages=440}}</ref> | ||