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Federal Open Market Committee

Overview#

Federal Open Market Committee (FOMC) consists of 12 members, seven from the Federal Reserve Board of Governors and 5 of the regional Federal Reserve Bank presidents.

Federal Open Market Committee oversees and sets policy on open market operations, the principal tool of national monetary policy. These operations affect the amount of Federal Reserve balances available to depository institutions, thereby influencing overall monetary and credit conditions.

Federal Open Market Committee also directs operations undertaken by the Federal Reserve in foreign exchange markets.

Federal Open Market Committee must reach consensus on all decisions. The president of the Federal Reserve Bank of New York is a permanent member of the Federal Open Market Committee; the presidents of the other Federal Reserve Bank rotate membership at two-year and three-year intervals. All Federal Reserve Bank presidents contribute to the committee's assessment of the economy and of policy options, but only the five presidents who are then members of the Federal Open Market Committee vote on policy decisions.

Federal Open Market Committee determines its own internal organization and, by tradition, elects the Chair of the Federal Reserve Board of Governors as its chair and the president of the Federal Reserve Bank of New York as its vice chair. deliberations and discussion.

Federal Open Market Committee formally meets eight times a year in telephone consultations and other meetings are held when needed.

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