The Federal Open Market Committee (FOMC) is the monetary policymaking body of the United States Federal Reserve System. It is responsible for setting monetary policy in the United States, including decisions related to interest rates and the money supply. The FOMC is made up of twelve members, seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank presidents. The Chair of the Federal Reserve Board serves as the Chair of the FOMC.
The FOMC meets regularly throughout the year to review economic and financial conditions in the United States and to determine appropriate monetary policy actions. This includes setting the target for the federal funds rate, which is the interest rate at which banks lend to each other overnight. The federal funds rate is a key tool for implementing monetary policy, as changes in this rate can affect the broader economy through their impact on borrowing costs and other financial variables.
The decisions made by the FOMC can have significant implications for the economy and financial markets, and its meetings are closely watched by investors and policymakers around the world.