Business, Legal & Accounting Glossary
FOMC. A 12-member committee that sets credit and interest rate policies for the Federal Reserve System. This committee consists of 7 members of the Board of Governors, and 5 of the 12 Federal Reserve Bank Presidents. This group, headed by the Chairman of the Federal Reserve Board, sets interest rates either directly (by changing the discount rate) or through the use of open market operations (by buying and selling government securities that affect the federal funds rate). The discount rate is the rate at which the Federal Reserve Bank charges member banks for overnight loans.
The Fed actually controls this rate directly, but it tends to have little impact on the activities of banks because these funds are available elsewhere. This rate is set during the FOMC meetings by the regional banks and the Federal Reserve Board. The federal funds rate is the interest rate at which banks loan excess reserves to each other. While the Fed can’t directly affect this rate, it effectively controls it through the way it buys and sells Treasuries to banks. There are 8 scheduled FOMC meetings during the course of each year. However, when circumstances dictate, the Fed can make inter-meeting rate changes.
The Federal Open Market Committee, or FOMC, is an arm of the Federal Reserve System, the US central bank. The Fed has three main monetary policy tools, one of which are open market operations. The Federal Open Market Committee sets the short-term objectives of these open market operations. The Federal Open Market Committee can aim for either a desired level of reserves or a target federal funds rate. This objective is achieved through the sale and purchase of US Treasuries and Federal agency securities. The Federal Open Market Committee meets eight times per year. Each Federal Open Market Committee meeting is concluded with the publication of a press release. Later the meeting minutes for the most recent Federal Open Market Committee are published. The Federal Open Market Committee has twelve members.
The federal open market committee was good to be a part of, but I did not like the other eleven members.
The Federal Open Market Committee set the rates that we were using so had no way of setting these rates ourselves.
The Federal Open Market Committee‘s influence is felt globally: not only domestic but also international equity, debt, and currency markets are affected by FOMC changes to interest rates and treasury bond-buying or selling.
Beige Book
go around
Fed bias
currency in circulation
coupon pass
Federal Open Market Committee Meeting (FOMC Meeting)
bill pass
monetary indicator
open market
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This glossary post was last updated: 1st November, 2021 | 0 Views.