The Federal Reserve our Central Bank is one of the country's most powerful economic institutions. This paper provides a brief overview of what Members of Congress should know about the Federal Reserve.
Inflation is determined by monetary policy.
The Federal Reserve influences interest rates. This paper briefly summarizes the structure and operating procedures of the Federal Reserve and comments on the significance of congressional oversight. A broad-brush overview, it is intended to lay the groundwork for several subsequent papers addressing issues related to congressional oversight of Federal Reserve monetary policy and the goal of price stability. As the Nation's Central Bank, the Federal Reserve is granted special privileges and so assumes the responsibilities and characteristics of such a bank. It monopolizes the issuance of paper money, serves as banker for both the government and commercial banks, and acts as lender of last resort.