Money & budgets
Federal Reserve
The central bank of the United States. It sets interest rate policy, supervises banks, and operates payment systems, independently of the annual budget process.
In full
Congress created the Fed in 1913 and gave it a dual mandate: maximum employment and stable prices. Its Board of Governors is appointed by the President and confirmed by the Senate to fourteen-year terms, and the Federal Open Market Committee sets rates. It is self-funding and is not appropriated money, which is the basis of its operational independence.
Also written as: the Fed, FOMC
Where to go next
Keep going
Browse every term in the glossary, or see the vocabulary in motion in the How government works walkthroughs.
A plain-language explanation for civic education, not legal advice. When in doubt, the official source named above controls.