membership includes the 7 Board of Governors and 12 Federal Reserve Bank Presidents
influences money supply through changes in interest rates
all Board of Governors and 5 of 12 FRB presidents vote on policy
Chair of Board of Governors is also Chair of FOMC
Meets 8 times/year (approx. every six weeks)
Federal Reserve functions
influence money supply, issue currency, sets and holds bank reserves, lends to banks and thrifts, clears checks, supervises banks and works with Treasury as Government's bank
Additional information: For additional information about the Fed, go to www.federalreserve.gov, select About the Fed, under The Federal Reserve System select Frequently Asked Questions.
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Select the Federal Open Market Committee (FOMC)
Release Date: December 13, 2005
For immediate release
The Federal Open Market Committee decided today to raise its target for the federal funds rate by 25 basis points to 4-1/4 percent.
Despite elevated energy prices and hurricane-related disruptions, the expansion in economic activity appears solid. Core inflation has stayed relatively low in recent months and longer-term inflation expectations remain contained. Nevertheless, possible increases in resource utilization as well as elevated energy prices have the potential to add to inflation pressures.
The Committee judges that some further measured policy firming is likely to be needed to keep the risks to the attainment of both sustainable economic growth and price stability roughly in balance. In any event, the Committee will respond to changes in economic prospects as needed to foster these objectives.
Voting for the FOMC monetary policy action were: Alan Greenspan, Chairman; Timothy F. Geithner, Vice Chairman; Susan S. Bies; Roger W. Ferguson, Jr.; Richard W. Fisher; Donald L. Kohn; Michael H. Moskow; Mark W. Olson; Anthony M. Santomero; and Gary H. Stern.
In a related action, the Board of Governors unanimously approved a 25-basis point increase in the discount rate to 5-1/4 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco.